NEW DELHI, MUMBAI, BENGALURU, KOLKATA, CHENNAI, AHMEDABAD, HYDERABAD, CHANDIGARH*, PUNE*, LUCKNOW* VOL. 18 NO.

151

Monday, June 24, 2024

Adani plans $3 billion for Unlisted local units of six

livemint.com pumped storage venture uP1 MNCs under scanner uP1
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Monday, June 24, 2024

Think Ahead. Think Growth.

mint primer QUICK EDIT

Will XR glasses, GST: Act

Neuralinks kill quickly
The Goods and Services Tax
smartphones? (GST) Council under the chair-
personship of finance minister
Nirmala Sitharaman, after its
BY LESLIE D’MONTE first meeting on Saturday since
India accounts for 10% of the 7 billion people using smartphones the new government assumed
globally. These, however, may be gradually replaced by extended office, has announced many
reality (XR) glasses, gesture-based screens and even brain-computer- changes to make compliance
interface (BCI) devices like Neuralinks in the next 10-15 years. easier. Among them are a
REUTERS waiver of interest and penalty
on certain past tax demands,
tweaks in monetary limits to
reduce litigation, reduction in
the pre-deposit amount needed
for filing appeals and exemption
of railway platform tickets,
among other items. These are
welcome moves that will ease
GST’s burden for some. Though
a few minor rate moves were
also announced, overall rate
rationalization has been left for
the next meeting to consider.
This will be key. No doubt, GST
has made taxation far simpler in
its seven-odd years of existence.
What prompted this Are there other However, it’s still a work in
1 question?
“In the future, there will be no
2 experts who agree?
Way back in 2013, Mary Meeker,
progress. A reduced number of
rate slabs and the inclusion of
phones, just Neuralinks,” Elon an internet analyst and partner at hydrocarbons under the regime
Musk recently posted on X, Kleiner Perkins Caufield Byers, must be matters of priority for
suggesting that Tesla’s brain chip said the future is about “wearables GST to deliver on its promise of
implant would eventually replace (smartwatches, etc.), drivables being a “good and simple tax”.
smartphones. It was his response (driverless cars), flyables (eplanes, Thankfully, buoyant revenues
to a post on X that showed an etc.), and scannables (QR codes,
can act as a cushion to re-craft
artificial intelligence (AI)-created etc.)”. In May 2022, Nokia CEO
image of Musk with a phone and a Pekka Lundberg said technologies this tax. Now is the time to go in
neural network pattern on his like embedded chips in our bodies for big-ticket reforms. The GST
forehead, asking if users would will replace smartphones by 2030. Council must get past minutiae
agree to implant a Neuralink. The Furturist Ray Kurzweil believes for more substantive progress.
product, called Telepathy, BCIs will kill smartphones. Apple
comprises an implant that records has underscored the future poten-
neural activity through electrodes, tial of augmented reality (AR) and
a surgical robot and a user app. wearable tech with products such
However, it is currently limited to
helping critically ill patients use
as a mixed reality (MR) headset
called Vision Pro and a MR
MINT METRIC
their thoughts to move their limbs. operating system called visionOS. by Bibek Debroy

With a controller ordered online,

3 What technologies could
take centre stage?
Future alternatives to smartphones
A couple’s reactions were serpentine.
include AR glasses, smart contact lenses
A live cobra tied with tape,
and wearable computers like advanced Made them gawk and gape.
smartwatches and smartbands with
features such as health monitoring,
A refund was paltry anodyne.
communication tools and even cellular
connectivity. Non-invasive BCIs enable
hands-free control, while flexible displays
combine portability with larger screens.
QUOTE OF THE DAY
The (overall) penetration of EVs
4 Isthisthere a timeline for
to happen?
The transition is likely to happen
5 What hurdles do they
need to overcome?
The limitations of XR glasses, BCIs
in India is something like 6%
in stages since we currently use and other advanced technologies and we see it quite easily
our smartphones not just for include limited functions, high expanding, double and
phone calls but also to surf the costs, bulky or intrusive designs
Internet, check emails, make audio that cause fatigue, and limited more than double,
and video calls, take pictures and battery life. There are also quite quickly.
selfies, see and even make videos concerns about privacy, data
and movies, play games, do security, health and ethics, and the
banking, make payments and shop need for significant user training.
online. Smartphones also keep an Then there’s the lack of a robust
eye on our fitness and health, and ecosystem of developers, resulting ABHINAV SINHA
are now evolving into AI- and in a lack of apps and services. MANAGING DIRECTOR,
generative AI-enabled devices, Manufacturers will have to build BRITISH INTERNATIONAL
capable of running AI and small interoperable ecosystems just as INVESTMENT
language models. So, this could they did for smartphones. This is
take a while. easier said than done.

THE WEEK AHEAD

LOK SABHA SESSION APSEZ SENSEX DEBUT
24 JUN

24 JUN

The first session of the 18th Lok Sabha begins. Shares of Adani Ports and Special Economic Zone
(APSEZ )will start trading on the BSE Sensex.
24-25 JUN

IPOs THIS WEEK HAL DIVIDEND

26 JUN

Initial public offerings of Sylvan Plyboard, Shivalic Hindustan Aeronautics to consider final dividend
Power Control, Petro Carbon & Chemicals to open. payout for fiscal 2023-24.

ESSEL GROUP PLEA US PRESIDENTIAL DEBATE

26 JUN

27 JUN

Bombay HC likely to take up Essel appeal against The first US presidential debate between Joe
Sebi summons in alleged fund diversion at Zee. Biden and Donald Trump to be hosted by CNN.

BHARATNET TENDER NEET FIASCO

30 JUN
28 JUN

Deadline ends for submission of bids for the Bhar- NEET-UG re-examination results announcement.
atNet phase-III project. Exam has been marred by allegations of paper leak.
 PLAIN FACTS

Bajaj Housing Finance:

bankable, but no bank
BY HOWINDIALIVES.COM

E
arlier this month, Bajaj Housing Finance filed a draft offer document with the capital market regulator to offer shares
worth about ₹7,000 crore to the public for the first time. Of this, ₹3,000 crore of shares are being sold by parent Bajaj
Finance. The remaining ₹4,000 crore will come in from new shares, which will help it expand its housing-finance busi-
ness. While Bajaj Housing is an efficient and profitable player in home loans, it faces structural issues, the most important
being competition from banks, which have a natural advantage.
Bajaj Housing is India’s second-largest housing finance company (HFC) as of 2023-24 with assets of ₹91,370 crore. LIC
Housing Finance leads, with ₹2.87 trillion in assets. HDFC had been at the top before it merged with HDFC Bank in July 2023.
Banks have an advantage over non-bank financiers as they can raise funds at a lower rate of interest through savings and
current deposits. HFCs, on the other hand, have to borrow from banks or raise funds via bonds. In late-2022, Crisil wrote,
“HFCs are expected to continue losing home-loan market share to banks amid stiff competition.”
As a result, stocks of HFCs have lagged those of banks and fellow non-banking finance companies (NBFCs) that operate
in areas—such as gold loans and auto loans—that have higher margins.
Interestingly, until a few years ago, HFCs traded at higher valuations than banks in terms of the price-to-book value. But
the NBFC crisis in 2018, triggered by the collapse of IL&FS, led to a re-rating of such stocks.

Housing finance stocks have lagged Housing finance stocks have lost their
peers in related spaces valuation edge
Indices rebased (March 2015 = 100) Price-to-book value ratio
Nifty Financial Services Ex Bank Index Nifty Bank Index
6 CMIE Index: Housing Finance Services Nifty Bank Index
CMIE Index: Housing Finance Services

350

5
306
300

256 4
250
246

3
2.89
200

150 2

100
1 1.43

50
0
Mar 2015 May 2024
Price-to-book values after July 2023 are not comparable with earlier months
0 due to the merger of HDFC with HDFC Bank.
Mar 2015 May 2024
Source: Centre for Monitoring Indian Economy (CMIE)

Prime vs Affordable Segment The less risky prime segment

also offers lower returns
BAJAJ HOUSING primarily operates in the so-called “prime” Net interest Return on average
segment of the market, where the ticket size of a loan is above income (%) assets (%)
Prime segment
₹50 lakh. In contrast, Aadhar Housing, which went public in
May, operates in the affordable segment (ticket size below ₹25 Tata Capital Housing 4 2.4
lakh). Besides the loan size, the difference between the two Can Fin Homes 3.6 2.2
PNB Housing 3.5 2.2
segments is in the type of borrowers and the risks they pose.
Bajaj Housing 3.4 2.4
Prime segment loans are perceived as safer, as a greater share of
LIC Housing 3 1.7
their borrowers are salaried. To compensate for their increased
risk, interest rates in the affordable segment tend to be higher. Affordable segment
This is reflected in the net interest income and return on Aptus Value Housing 10.4 6.8
average assets of affordable segment lenders. “One segment Aadhar Housing 7.2 4.2
where HFCs have been growing relatively faster is affordable Home First Finance 6.5 3.8
housing loans, where competition from banks is limited,” said Aavas Financiers 6.1 3.3
Crisil in its 2022 report. “Given their relatively small footprint Data for 2023-24. Companies arranged in descending order of net
and large underlying demand, AHFCs are expected to keep interest income in respective segment.
growing faster than traditional HFCs.” Source: Bajaj Housing Finance draft red herring prospectus

Bad loans of housing finance

companies have shot up
Quality of Loans
Gross non-performing assets (%) AS A whole, though, HFCs have seen more loans turn bad than
Mar 2019 Mar 2022 Dec 2023 various types of banks. The share of loans in HFC portfolios that
Housing finance have not been serviced for 90 days or more rose from 1.65% in
companies (HFCs) March 2019 to 4.77% in December 2023. This was partly
Non-banking finance because HFCs target borrowers in the affordable housing
companies (NBFCs)
segment, which tends to be riskier. As of December 2023, HFCs
Small finance banks
accounted for about one-third of loans in this segment, as
Public sector banks compared to 11% in the prime segment, where banks dominate.
Bajaj Housing Finance, though, is a relatively good performer.
Foreign banks As of December 2023, its gross non-performing assets (NPAs)
stood at 0.22% of its loans outstanding, against 4.4% for LIC
Private banks
Housing Finance and 3.8% for PNB Housing Finance.
0 1 2 3 4 5 6 According to its issue prospectus, the company focuses on
This shows share of loans that were due for 90 days or more. Data for
banks pertains to housing loans only. Categories arranged in “mass affluent clients”, with an average age of 35–40 years and
descending order of December 2023 figures. an average annual salary of above ₹13 lakh. About 88% of its
Source: Bajaj Housing Finance draft red herring prospectus
customers are salaried.

Stiff Competition HFCs are losing share in the main

home loan segment
DESPITE ITS superior loan quality, Bajaj Housing’s focus on Share of loans outstanding in prime segment (%)
the prime segment is, ironically, also a challenge. This is also the Mar 2019 Dec 2023
focus of public-sector banks, which have a lower cost of funds. 47.4
As a result, the market share of HFCs in this segment has Private banks
48.4
decreased steadily from 19% in FY19 to 11% in the first nine 28.5
Public sector banks
months of FY24. According to Crisil, “The ability of HFCs to 37.4
compete with banks in the traditional salaried-home-loan Housing finance 18.9
segment remains a challenge given their relatively higher companies (HFCs) 11.1
funding costs. And in the non-home loan segments (developer 4.2
Foreign banks
financing and LAP [loans against property]), which have been 1.9
yield kickers, HFCs’ exposure has reduced in the past few years, Non-banking finance 1
which has put pressure on overall spreads.” In the absence of a companies (NBFCs)
banking connect, such as HDFC, how Bajaj Finance squares up Small finance banks 0
against banks will be a crucial determinant of growth. 0.1
www.howindialives.com is a database and search engine for Categories arranged in descending order of December 2023 share.
Source: Bajaj Housing Finance draft red herring prospectus
public data.
PARAS JAIN/MINT

PEANUTS by Charles M. Schulz

 New Delhi, MUMBAI, BENGALURU, KOLKATA, CHENNAI, AHMEDABAD, HYDERABAD, CHANDIGARH*, PUNE*, LUCKNOW* VOL. 18 NO. 151 Rs. 10.00 . Price with Hindustan Times Rs. 15.50 18 PAGES

Monday, June 24, 2024

Why Modi 3.0 needs a new Many big IPOs in FY25, says
livemint.com economic blueprint uP10 JM Fin’s Sonia Dasgupta uP4

SENSEX 77,209.88 0.00 NIFTY 23,501.10 0.00 DOLLAR₹83.54 ₹0.00 EURO ₹89.38 ₹0.00 OIL $85.09 $0.85 POUND ₹105.70 ₹0.00

Adani plans $3 billion for Unlisted local units

of six MNCs under
DON’T MISS
ISRO

pumped storage venture ownership scanner

Maharashtra, AP, TN, Telangana in sights; 5GW capacity planned in first five years Gireesh Chandra Prasad
gireesh.p@livemint.com
NEW DELHI
Anirudh Laskar clean energy under operation, in
power move Isro’s workhorse PSLV stalls as

A
anirudh.l@htlive.com addition to 15.25GW thermal fter LinkedIn and Sam-
MUMBAI power plants in seven states. sung, Indian authorities demand cools
The Adanis are looking to gain an edge in India’s clean-energy
An email sent to Adani Group’s may expand their own- Nearly six months into 2024, Isro has not

T
industry, where top business groups are pumping in billions of dollars.
he Adani Group plans to spokesperson remained unan- ership checks to the local arms conducted a single commercial launch
invest ₹25,000–27,500 swered. of more multinational corpora- mission for any Indian entity. According to
crore (about $3 billion) ₹ 25,000-27,500 cr 25 GW $ 3.4 bn “Financial closure for commis- tions (MNCs). According to two Isro’s chairman S. Somanath, the fledgeling
to set up its first Investment (for 6–8 GW) sioning 3.5GW of PSH capacity people aware of the matter, domestic space industry needs to “create an
Final target
pumped storage hydro- has already been done,” said the about six unlisted Indian units internal demand and market”. >P7
Increased
power (PSH) facility, according to SEGMENT $ 1.6 bn
debt funding first person. The two people added of MNCs are under the radar of
two people aware of the conglom- Pumped storage (now) ₹ that the 5GW target will be funded Registrars of Companies
(for 3 GW) ₹ Paracetamol among 50 drugs
erate’s plans. PSH produces elec- hydropower by issuing new shares and raising (RoCs), who are scanning com- RoCs are scanning company
Debt funding (FY24) found substandard by regulator
tricity by moving water between debt, and that the group has pany disclosures and publicly disclosures. PRANAY KOKA
two reservoirs at different eleva- already begun basic construction available shareholding infor-
tions. ₹9,350 crore ₹ 2.82 tn
work for the first 500MW PSH mation of group companies. year, including companies and
The drug regulator has found 50 lifesaving
medicines to be of sub-standard quality
(25% already infused) Market capitalization
Under the plan, Adani Green of AGEL* project in Andhra Pradesh, which Earlier this month, the RoC limited liability partnerships across India. Paracetamol 500mg tablets,
Adani family investment
Energy Ltd (AGEL) will set up PSH commitment *AGEL: Adani Green will be commissioned in FY27. in Uttar Pradesh held in sepa- (LLPs), and would soon be which have been found to be sub-standard,
capacity of 5GW in the next five Energy Ltd Typically, infrastructure assets rate orders that Samsung SDI reaching the level of some of are manufactured by Askon Healthcare
Source: Mint research, based in Ujjain, Madhya Pradesh. >P2
years. “We will eventually increase company filings are funded with debt and equity in India Pvt. Ltd and Samsung the developed countries in
this to 25GW, which will take the the ratio of 70:30. For funding Display Co. Noida Ltd failed to Europe. “In such a scenario,
group’s total green-energy capa- Adani’s green energy projects of identify Lee Jae-Yong, execu- unless the quality of enforce-
bility to 70GW,” one of the people 11GW in the next two years, tive chairman of South Korea’s ment is good, it can cause prob- India planning global trade
cited above said on the condition NEW VISTAS including the latest one based on Samsung Electronics Co. Ltd, lems in future,” the person said promotion body for MSMEs
of anonymity. aDANI Group had so The group already This was besides PSH, the equity portion of financ- as a “significant beneficial on the condition of anonymity.
The Centre may propose a global trade
To start with, the group will set far focused on solar has 11GW clean 15.25GW thermal ing will come from promoter fund owner (SBO).” Last month, the Regulatory action against promotion body focused on boosting
up PSH generation facilities in and wind power units energy in operation plants in seven states infusion and internal accruals, RoC for Delhi and Haryana alleged non-disclosure of bene- MSME exports in the upcoming Union
four states—Maharashtra, Andhra according to the two persons cited imposed penalties of over ₹27 ficial owners is part of a larger budget. The move comes against the
Pradesh, Tamil Nadu and Telan- above. lakh on LinkedIn Technology effort to enhance the quality of backdrop of India’s rising trade deficit and
gana. country’s fast-growing clean-en- panies are already in the fray AGEL generated ₹3,400 crore Information Pvt. Ltd set up in enquiries by RoCs, who have the urgent need to boost exports. >P2
“This will require an investment ergy industry, where top business including Tata Power, NTPC, and of free cash flow to equity in fiscal India, Microsoft Corp. chief been proactive in the last few
of ₹25,000–27,500 crore, based groups such as Mukesh Ambani’s JSW. 2024. The Adani family has com- executive Satya Nadella, years in removing defunct
on the current costs. Some of the Reliance Industries, Tata Group, Adani Group has so far focused mitted investments of ₹9,350 LinkedIn CEO Ryan Roslansky companies from the official NOTE TO READERS The Media
required reservoirs and separate Vedanta Group and JSW Group on solar and wind energy genera- crore in AGEL, of which 25% is and seven other individuals for registry and in detecting shell
Marketing Initiatives on pages 3 and 5 are the
elevation facilities have already are pumping in billions of dollars tion in its clean energy business. already infused and the balance alleged violation of SBO report- companies.
equivalent of paid-for advertisements, and no
been put in place,” said the second in renewable energy projects, As of now, the group’s target of ₹7,012 crore will be exercised dur- ing norms. “It is a fact that bigger com- Mint journalist was involved in creating them.
person. including solar, wind, PSH, and 45GW clean energy has been ing the current financial year. This One of the persons cited panies create complex struc- Readers would do well to treat them as
The development comes as the green hydrogen. raised to 50GW by 2030 following above said India is adding about advertisements.
Adanis look to gain an edge in the In PSH itself, several other com- the PSH move. It already has 11GW TURN TO PAGE 6 150,000 new businesses every TURN TO PAGE 6

Derivatives market is flashing Why Varma, Goyal voted

signals of a decline this week for rate cut at MPC meet PTI JVARMA.IN
Ram Sahgal Gopika Gopakumar
ram.sahgal@livemint.com
Shifting stance gopika.g@htlive.com
Net long/short open positions in index future contracts as of 21 June
MUMBAI MUMBAI
Long Short

S T
500,000
ignals from the deriva- he two monetary policy
tives market are pointing 400,000 committee (MPC) mem-
at a stock market decline bers who voted to cut
300,000
this week, before a likely pre- interest rates and change mon-
A screengrab from JSPL’s ‘Steel of India’ ad campaign. YOUTUBE/JSPL budget rally gets underway in 200,000 etary policy stance at its last
July. meeting believe the Indian

Lawsuit, Cannes
100,000
This comes as retail and high economy needs to grow at its
net worth investors (HNIs) shift 0 potential growth of 8%, as infla-
Client DII FII Proprietary traders
their stance to bearish while tion continues to approach the
Cumulative index futures contracts open position

metals put Jindal

foreign investors turn bullish. target of 4%. The MPC had MPC members Ashima Goyal (left) and Jayanth Varma.
DII: domestic institutional investor; FII: foreign institutional investor Source : NSE
Such flipping often results in voted to keep repo rate
PRANAY BHARDWAJ/MINT
market dips or pullbacks in the unchanged at 6.5% for the the growth rate in 2024-25. turing, construction, mining
short term. 73,991 bullish contracts. was net long 117,990 contracts. eighth consecutive time in its This is because monetary pol- and services sectors.

Steel ad in focus Retail/HNI, designated ‘Cli-

ent’ by NSE, who were cumula-
tively net bullish index futures
Whenever such flips have hap-
pened in the past, markets have
tended to pull back or dip. A
From there, the Nifty tanked
1000 points to close at 19133.25
on 2 November.
June meeting.
Jayanth Varma, who had
been voting for a rate cut since
icy acts with a lag of 3–5 quar-
ters. The task now is to bolster
growth in 2025-26, and even
“India is at a point in the
demographic transition where
we need to grow rapidly to
Gaurav Laghate respondent (Jindal Steel) of a (Nifty and Bank Nifty) by pullback is a dip of 5-10% from By that date, retail/HNI had February this year, argues that for that, we need to start acting meet the aspirations of the new
gaurav.laghate@livemint.com new campaign prima facie 333,364 contracts on 4 June, a peak, while a correction indi- flipped to a bullish 292,822 MPC should start cutting rates in this quarter. In my view, the entrants into the work force.
MUMBAI seemed to be substantially the day of the election results, cates a 10-20% fall from the contracts and FIIs to a bearish this quarter to give a boost to goal should be to add 75–100 Finally, there is a lot of catch-up
based on a similar theme, flipped these to turn net bear- peak. 351,396 contracts, after which growth in FY26. basis points to the 2025-26 growth required to bring the

J
indal Steel and Power’s expressed through a montage ish by 57,613 contracts over 12 For instance, on 18 Septem- Nifty rallied 2100 points over In an emailed interview, growth rate,” said Varma. level of GDP back to the pre
“The Steel of India” cam- of sequential images and videos sessions ending 21 June. ber last year, when Nifty was just 34 sessions to 21255.05 on Varma said the goal should be India’s GDP grew a sharp pandemic trend line,” Varma
paign has landed in a con- stitched together by a sound- In the same period, foreign trading at 20133.3, retail/HNI to add 75–100 basis points to 8.2% in FY24, supported by added.
troversy with allegations of scape of steel,” the court institutional investors (FIIs) was net short 84,214 contracts TURN TO PAGE 6 the FY26 growth rate. strong January-March quarter While the MPC has not made
idea theft, igniting a fierce observed. “It is clarified that changed their net bets on index (adjusted for change in Nifty “I do not think anything that growth of 7.8%. The push to a growth projection for FY26, it
debate within the advertising observations made above are futures from 355,379 bearish contract size to 25 shares from Derivatives criteria rejig we do with monetary policy GDP growth came from several
industry. The row began when purely prima facie in nature for contracts to a cumulative 50 as 26 April this year) and FII likely this week >P4
now will have much impact on key sectors including manufac- TURN TO PAGE 6
advertising agency Wie- the reason that this issue of
den+Kennedy (W+K) India infringement of copyright will
moved the Delhi high court have to be considered by the
(HC) in March, alleging that
Jindal Steel had plagiarized a
campaign concept they had
sole arbitrator.”
This verdict led to an out-of-
court settlement between the
Europe’s response to China shock 2.0: Hold China closer
originally pitched and accusing Delhi-based Jindal Steel and
the steelmaker of dishonouring W+K, where the client paid the Tom Fairless from Chinese electric-vehicle ated companies or plants—has nese auto imports. Some ana-
a service agreement. dues to W+K and got the intel- feedback@livemint.com manufacturers such as BYD in risen rapidly, reaching 78% of lysts saw this as an implicit
According to the petition by lectual property and other Hungary and Chery Automo- all Chinese foreign direct encouragement to Chinese

T
W+K, they had worked on the rights transferred. he first China shock that bile in Spain. investment in Europe last producers to shift auto facto-
campaign for four months, Despite the settlement, the devastated manufactur- In the 1980s, faced with a year, according to data com- ries to Europe instead, which
receiving approval from Jindal controversy resurfaced when ing in the U.S. in the wave of low-cost Japanese piled by the Mercator Institute some have started doing.
Steel for the production house Earlyman Films and Kondur- early 2000s bypassed large auto imports, the Reagan for China Studies and Rho- For both Europe and China,
and other elements, only for kar Studio, which claimed parts of Europe. A second administration negotiated dium Group. closer cooperation would
Jindal Steel to abruptly aban- credit for the campaign, shock now under way looks export quotas that encouraged At the core of this strategy is hedge against a return to the
don the project without expla- entered it in the Cannes Lions much more threatening. Japanese manufacturers to a fear that Europe, and espe- White House by Donald
nation. W+K India was sur- awards and the Kyoorius Crea- B u t build facto- cially Germany, which relies Trump , who is pledging 10%
prised to see the same cam- tive Awards 2024. rather than ries in the much more on manufacturing across-the-board tariffs on
paign on air at the end of While the Kyoorius commit- simply U.S. than the U.S., could be hit by imports. That threat argues
March, bearing a striking tee, after reviewing the case erect ever U.S. offi- one of two nightmare scenar- against Europe fully throwing
resemblance to the one they with industry juries and a legal higher barriers to the flood of cials have been less willing to Squeezed between threat of Trump and Chinese imports, ios: a global trade war, or a new in its lot with the U.S., while
had presented to Jindal Steel in team, decided to disqualify all Chinese imports, as the U.S. repeat that formula with European leaders woo Chinese investment and know-how. REUTERS flood of cheap Chinese encouraging China to smooth
mid-2023. entries from Kondurkar Studio has done, European leaders China, which, unlike Japan, imports. over tensions with Europe and
On 24 April, the Delhi HC and Earlyman Films across cat- are seeking an alternative: roll- they consider a threat to China. Europeans worry less While Chinese purchases of European Union regulators maintain access to its lucrative
referred the matter to arbitra- egories, the campaign went on ing out a welcome mat. national security. The White about such risks, although existing European businesses this month signaled plans to market.
tion, with some observations to win a Silver Lion and a European officials have House, for example, is weigh- they could change their have collapsed in recent years, impose relatively modest tar- If so, Europe’s industrial and
favouring W+K’s claim, though Bronze Lion at the 2024 Can- largely been in favor of invest- ing curbs on Chinese “ con- minds—as they did on telecom in part because of growing iffs—the highest will be half technological ties to China
it did not allow for an interim ments from Chinese battery nected cars ” that could trans- infrastructure supplied by European scrutiny, greenfield the 100% recently announced
injunction. “The launch by the TURN TO PAGE 6 makers such as CATL and mit customer data back to Huawei Technologies. investment—i.e. newly cre- by President Biden—on Chi- TURN TO PAGE 6
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02 MONDAY, 24 JUNE 2024
NEW DELHI ECONOMY & POLICY LIVEMINT.COM

STRAIGHT
F O R WA R D
India planning global trade India plans
to reduce
SHASHI SHEKHAR

Respond to this column at

feedback@livemint.com
promotion body for MSMEs wheat
import duty
Puja Das
GANGA NEEDS JOINT Move comes against the backdrop of India’s rising trade deficit, urgent need to boost exports
puja.das@livemint.com
NEW DELHI

EFFORTS TO REGAIN
I
ndia is set to resume wheat
Rituraj Baruah & Dhirendra Kumar from April. imports by lowering the duty

ITS OLD STRENGTH NEW DELHI Merchandise exports increased to

$38.13 billion in May, up from $34.95
on inbound shipments while
also imposing stock limits on

T
he Centre may propose a billion in May 2023 and $34.99 billion in the grain, three officials said, in
global trade promotion body April. a new attempt to tame prices

A
few days ago, I was at the Ganga Dussehra. As I stood focused on boosting MSME Imports, however, saw a sharper rise, and boost supplies.
there, chanting lines from Pandit Jagannath Shastri’s exports in the upcoming reaching $61.91 billion in May, up from Additionally, the govern-
Ganga Lahri, an incident returned to memory. Union budget, three people $57.48 billion in May 2023 and $54.09 ment is planning to kick off
I was on board an Assam-bound Rajdhani Express crossing the aware of the development said. The billion in the previous month. open market operations sales.
bridge connecting Garhmukteshwar and Gajraula. When the move comes against the backdrop of MSMEs are a key constituent of the India, the second-largest
coach I was in reached the middle of the bridge, I offered prayers India's rising trade deficit and the urgent Indian exports ecosystem, contributing wheat producer worldwide,
to Ma Ganga. need to boost exports, the people said on about 45% to the country's total exports, has a 44% duty on wheat
When I was done with the prayers, my co-passengers, a white condition of anonymity. according to a Global Trade Research imports, imposed six years ago,
couple, wanted to know what was it that I had been doing. I told The new global trade promotion Initiative (GTRI) report. They also which effectively stopped ship-
them the river we had just crossed was the Ganga and that I had organization (GTPO) is being conceptu- account for around 38% of India's manu- ments of the grain.
been offering my prayers to it. The man seemed taken aback. alized on the lines of the Japan External facturing output. Traders have been asking
“Ganges, the great Ganges,” he asked in amazement, while his Trade Organization and Australian MSMEs also contribute about 27% to the government to relax import
companion made a statement that I will not repeat here for it Trade and Investment Commission, and India's GDP and employ more than 110 norms so that they can resume
pained me and may hurt the religious sentiments of others, too. will have branch offices in major econo- The GTPO is aimed to help small businesses with registration, licensing, and million people, making it the largest imports at a time international
For ages, the Ganga for us has been a source of life, and salva- mies. certification required for exports of goods and services. HR employer after agriculture (about 148 prices are low on account of a
tion. When I see a river anywhere in the world, it reminds me of “There has been a demand and also a million employed, according to GTRI). glut in Russian production.
the rivers that run through Prayagraj, Kashi, and Mirzapur, where consideration for a trade promotion goods and services to different devel- its branches in other countries is key for A NITI Aayog report on MSME However, the matter is sensi-
I spent my childhood. I see the Ganga as a metaphor of the purity body that would have offices abroad and oped and developing economies, and the country's MSMEs,” Vinod Kumar, exports released in March this year said: tive for farmers and any duty
of childhood. work hands-on in terms of promoting creating business opportunities for president of India SME Forum said. "It "Exports represent an enormous and cuts would have to be mindful
However, the river is no longer considered pure and pious in exports for MSMEs who do not have the them in coordination with India's con- would be apt if such a body is given a tar- under-utilized opportunity for the of that.
scientific terms. economic muscle to promote their sulates abroad. get to increase India's exports to MSME sector. “If at all India imports, it is
According to studies on pollution in the Ganga conducted by goods and establish a market abroad on “It will work like a one-stop solution $1 trillion.” Sectors where Indian unlikely to be more than 3-4
Prof. B. D. Joshi of the Indian Academy of Environment Science their own,” said one of the people cited for MSME firms. The commerce minis- India’s merchandise MSMEs can participate and million tonnes,” said one of the
in Haridwar, the current Biochemical Oxygen Demand (BOD)
level in the river is 7 mg/l, which is extremely unhealthy. Also,
above.
Another person said
try is hoping that it will play exports in the just-con-
a key role in reducing trade cluded financial year
Fall in India’s
3.11%
compete in export mar-
kets include handicrafts,
officials cited above.
The government estimates
solid waste content in the river when it reaches the foothills, was that although there are deficit by encouraging (FY24) fell by 3.11% to handloom textiles, ayur- wheat production in the
found to be 1,460 mg/l, which exceeds the threshold. The rise in sector-specific trade pro- MSME exports,” the third $437.06 billion from merchandise veda and herbal supple- 2024-25 season to be on par
solid waste has reduced Ganga’s transparency to 5%. Another motion bodies in the coun- person said, adding that it $451.07 billion in FY23, as exports in FY24 ments, leather goods, imi- with last year at 112.9 million
study found that plastic trash in the river rose 25% between May try along with the India Trade Promo- would also help smaller business partici- per commerce ministry tation jewellery and wooden tonnes.
and June 2024. From Rishikesh to Haridwar, fish numbers have tion Organisation, they do not have a pate in global exhibitions, trade shows data. products. Globally, these sec- “If duty is reduced, allowing
dropped to 80%, and the number of species fell dramatically from robust presence globally and mostly and buyer-seller meets. Merchandise trade deficit wid- tors constitute substantial markets private wheat imports, interna-
89 to 66. Crocodile populations have also dropped. work out of India. Queries sent to the ministries of com- ened to a seven-month high in May, but exceeding $340 billion, whereas their tional wheat will likely reach
People typically blame the growing number of tourists and pil- The GTPO is aimed to help small merce, MSME and finance remained largely due to a surge in imports. domestic market is considerably India via all major south Indian
grims to Ganga’s woes, but there are other causes, too, behind businesses with registration, licensing, unanswered till press time. The deficit stood at $23.78 billion in smaller." ports from 1 July,” the other
this. These should be thoroughly debated in the Parliament so and certification required for exports of “Such a trade promotion body with May, up 5.5% year-on-year and up 24.5% rituraj.baruah@livemint.com official said.
that the government can develop an action plan.
There are various locations such as
Despite changes Kaushambi, just before Prayagraj,
in government, where people can now cross the Ganga
on foot. This is happening even when
the situation of the Yamuna, with all its waters has 50 life-saving drugs Government likely to issue green bonds
the Ganga has
continued to
deteriorate
been subsumed into the Ganga. Only
7,000 cusecs of water from Ganga and
Yamuna rivers put together currently
fail quality checks Rhik Kundu
rhik.kundu@livemint.com
each were sold across January
and February 2024; bonds
flow forward. Though several other NEW DELHI worth another ₹5,000 crore
rivers join the Ganga downstream, its Priyanka Sharma nisation’s (CDSCO) drug alert were sold by March.

T
water flows are dismal. priyanka.sharma@livemint.com for May, the drug samples were he upcoming Union bud- “Several factors are driving
This is why I dread the fate of Kashi, where I spent my child- NEW DELHI picked from Waghodia (Guj- get may propose to issue this increased target. India’s
hood playing on the Assi Ghat on the banks of the river. Mounds arat), Solan (Himachal Pra- sovereign green bonds recent inclusion in the JP Mor-

T
of sand have started appearing between Dashaswamedh and he drug regulator has desh), Jaipur (Rajasthan), Har- worth about ₹25,000 cro- gan bond index fund is
Sakka ghats on the western edge. If the heatwaves continue, the found 50 important idwar (Uttarakhand), Ambala, re-₹30,000 crore as a part of expected to attract substantial
situation could worsen. One reason behind this state of the Ganga medicines, including Indore, Hyderabad, and the borrowing schedule for interest from foreign portfolio
is that it has not been dredged for quite some time. those used to control fever and Andhra Pradesh among other FY25, and a large chunk of it is investors (FPIs) in long-term
This river requires regular, phased dredging from Haridwar seizure, to be of sub-standard states. likely to be sold during the sec- sovereign green bonds. Addi-
to Ganga Sagar. quality across India. Paracetamol 500 mg tablets, ond half of the year, two people tionally, the Reserve Bank of
A lot of money has been spent to clean the Ganga at Varanasi, The list of such drugs which have been found to be aware of the matter said. India (RBI) has permitted FPIs
but what are the conditions today? Only 70 to 75 million litres per includes Paracetamol 500 mg, sub-standard, are manufac- Proceeds from the sale will to invest in these bonds via the
day (MLD) of the 467 MLD of sewage released by the city enters Telmisartan anti-hypertension tured by Askon Healthcare finance sustainable infrastruc- International Financial Servi-
the Ganga untreated. But the Varuna river, the tributary from drug, Cuftin cough syrup, based in Ujjan, Madhya Pra- ture projects. Proceeds from the sale will finance sustainable infrastructure ces Centre (IFSC), further
which Varanasi derives its name, brings 67 MLD of sewage dis- Clonazepam tab- desh. The firm, on This is seen as evidence of projects. HT boosting market confidence,"
charged into it into the Ganga. lets used to man- The list of its official website the government’s commitment said Venkatakrishnan Sriniv-
According to research conducted by a team from the Kashi age seizures, anti- such drugs claims that it has to scaling up green finance ini- ments used to fund projects So far, the government has asan, managing partner at
Hindu University, all fish in the Ganga between Prayagraj and pain relief drug includes been manufactur- tiatives. with a positive environmental decided to raise ₹12,000 crore Rockfort Fincap Llp, a financial
Buxar have been affected by pollution. Furthermore, vegetables Diclofenac, multi- Paracetamol, ing pharmaceuti- "The borrowings made impact—have found interest from the sale of green bonds advisory firm.
and foodgrains grown in the doab area (land between two rivers) vitamins and cal- cal finished dos- through green bond instru- among investors to align their during H1, FY25. Last September, JP Morgan
irrigated by its waters are also contaminated. Hundreds of peo-
Telmisartan,
cium tabs. age forms. ments during the ongoing fis- financial goals with their values Interestingly, the budget for said it would add 23 Indian gov-
ple, including myself, used to cross a Pontoon Bridge to reach The drug regu- Cuftin cough Phone calls and cal (FY25) will be higher than and contribute to positive FY24 made no mention of ernment bonds to its widely
Ramnagar, which used to be a good market to buy organic and lator also found syrup, etc email queries sent last year, as there is a demand change. green bonds. However, the tracked emerging market debt
fresh vegetables and watermelons cultivated on the banks of the that commonly to the Askon for sustainable bonds in the During FY23, government later index beginning 28 June 2024,
Ganga. applied Henna or Healthcare market," said the first person the government included a while Bloomberg Index Servi-
A lot can be written on this topic, and much has already been mehndi is also of poor quality remained unanswered. Other mentioned above, requesting raised about phased ₹20,000 ces had in March said it would
documented. About 40 years ago, I wrote a cover story on the and misbranded as per provi- medicines on the list include anonymity. ₹16,000 crore crore green bond include 34 Indian government
Ganga for a famous magazine, and even then, the figures were sions laid down under the cos- lactulose solution used to treat “The centre is likely to raise through sover- plan for the sec- bonds in its Emerging Market
similarly appalling. Nature has been sounding the alarm for a metics category. This comes constipation, anti-hyperten- about ₹25,000 crore-₹30,000 eign green bonds, which was ond half of the borrowing cal- Local Currency Index from 31
long time, urging us to wake up. The fertile land of north India is even as India’s pharmaceutical sion drug Telmisartan, Amlodi- crore from green bonds as a hiked to about ₹20,000 crore endar. January next year. Interest-
unimaginable without the Ganga, Yamuna, and their tributaries. sector is under the scanner pine IP tablets, Dexamethasone part of the borrowing calendar in FY24. The anticipated Of this, bonds of ₹5,000 ingly, the government did not
Yet, despite changes in government, the situation has continued after cough syrups made in the SodiumPhosphate Injection I.P for FY25,” the person added. increase to ₹25,000-30,000 crore with a tenure of five years accept bids in the sovereign
to deteriorate. The Ganga will be protected not by slogans, but country were linked to the used to manage auto-immune Amid pressing issues like cli- crore for FY25 underscores the were sold in November 2023, green bond auction of ₹6,000
by the collective efforts of society and the political system. deaths of children overseas. diseases and Clonazepam Tab- mate change and other envi- government’s commitment to and ₹ 10,000 crore worth of crore held on 31 May, despite
Shashi Shekhar is editor-in-chief, Hindustan. Views are per- According to the Central letsI.P.0.5mg used for treating ronmental challenges, green scaling up green finance initia- bonds with a tenure of 30 years receiving bids totalling ₹ 12,677
sonal. Drugs Standard Control Orga- neurological complications bonds—fixed-income invest- tives, said the person. in two tranches of ₹5,000 crore crore.

CBI files case in NEET (UG) exam irregularities, forms special teams CORRECTIONS AND
CLARIFICATIONS
Mint welcomes comments,
Neeraj Chauhan to investigate the irregularities duct of the examination pro- the NEET (UG) examination,” entire gamut of events and the suggestions or complaints
letters@hindustantimes.com “on top priority” and rushed cess. a CBI spokesperson said on larger conspiracy”. about errors.
NEW DELHI them to Bihar and Gujarat to The federal agency has Sunday. Accordingly, the CBI
Readers can alert the
ascertain details of probes invoked sections 120-B (crimi- The ministry of education, spokesperson said, the agency
newsroom to any errors in the

T
he Central Bureau of being carried out by the police nal conspiracy) and 420 the spokesperson said, has has “registered a criminal case paper by emailing us, with your
Investigation (CBI) on there. (cheating) in its first informa- requested the CBI to conduct a and initiated an investigation”. full name and address to
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investigate a “larger conspir- investigating a NEET-UG “The allegations in the FIR into the entire gamut of formed by the CBI to investi-
acy” in the conduct of National paper leak matter since last state that the NEET (UG) 2024 alleged irregularities, includ- gate the matter on top priority. It is our policy to promptly
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Eligibility-cum-Entrance month and has arrested over a examination was conducted ing conspiracy, cheating, Special CBI teams are being Readers dissatisfied with the
Test-Undergraduate or dozen persons. Subsequently, by the National Testing impersonation, breach of sent to Patna and Godhra response or concerned about
NEET-UG exam, people famil- Gujarat Police arrested half a Agency (NTA) on 5 May at trust, and destruction of evi- where local police cases have Mint’s journalistic integrity may
iar with the development said, dozen individuals, including 4,750 centres in 571 cities, dence by candidates, insti- been registered,” the spokes- write directly to the editor by
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other malpractices. Godhra. may send a team there as well, evening, the Union education alleges that certain isolated of public servants, if any, con- which was being sold on the newsroom is available at
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LIVEMINT.COM DEALS, TECH & STARTUPS MONDAY, 24 JUNE 2024
NEW DELHI 03

m THE MONDAY QUIZ

1) WHICH tech giant 2) GOOGLE’S Gemini
It’s fundamentals over Daggubati invests in
new tequila brand
growth for startups
has become the world’s App, launched in India
most valuable firm with a last week, comes in how
$3.34 trillion market cap? many Indian languages? Varuni Khosla
varuni.k@livemint.com
3) WHICH antivirus software was banned by the US NEW DELHI
government last week due to security concerns?

A
ctor Rana Daggubati
4) WHICH global IT 5) WHICH ex-Walmart has launched a new
company has achieved executive was appointed Founders even at an early stage focusing on building durable businesses tequila with musician
$2 billion in GenAI sales PayPal’s chief technology Anirudh Ravichander and
year-to-date? officer last week? Shree Harsha Vadlamudi, the
Priyamvada C owner of microbrewery Iron-
priyamvada.c@livemint.com hill India, with the three invest-
BENGALURU ing a combined $10 million in (From left) Vadlamudi,
GLOSSARY the company, Ironhill Hospi- Ravichander and Daggubati.

I
n signs of an ecosystem maturing after tality Pvt. Ltd. The tequila,
a harsh funding winter, investors say called Loca Loka, will be made brand comes to India, will
Zero knowledge proof: managed within the geo- that startup founders even at an early from 100% agave grown in the require more investment.
A cryptographic method, graphical boundaries of stage are focusing more on core funda- Jalisco region of Mexico. The actor has previously
zero knowledge proof is a the country they serve. mentals such as operating models and the Sales will begin in the US and partnered with Prasad Vanga
way by which a party Governments and institu- path to real profitability, among others, the brand will be launched in from Anthill Ventures, which
(called the prover) convin- tions handling sensitive needed to build a durable business, rather India in the following 18-24 was an investor in gin and tonic
ces the other party (called information like citizen than just looking at growth. months, Dagubatti told Mint. mixer brand Salud Beverages.
the verifier) that it pos- data, intellectual property “In the short to medium term, we are “We worked with a good Vadlamudi owns a dozen
sesses a piece of data or or classified information seeing businesses pausing growth and master distiller and started breweries across the country
information, without prefer sovereign cloud. even allowing for shrinkage to weed out contract manufacturing but the under the brand Ironhill India.
revealing the data itself. unsustainable and harmful elements,” branding began about a year The company is betting that
While zero proof knowl- Deadpool: In the context said Sheetal Bahl, a partner at Merak Ven- ago. This is a celebration drink, tequila’s popularity in India will
edge techniques have been of startups, deadpool refers tures, adding this is not a permanent shift. and there’s a unique way that grow over the next decade.
around for decades now, to list of companies that “Once startups consolidate their posi- India celebrates. Telangana, for India has just a handful of
there has been renewed have shuttered and ceased tions, they’ll refocus on growth, but in a As growth is fundamental to venture investing, early-stage startups are expected to instance, has a palm wine called brands that sell high-quality
interest with the advent of operations. Deadpool more calibrated manner… It’s a sign of a deliver prolific growth to show that there is potential for disruption in the market. MINT kallu, which is used as a cele- sipping tequila, such as Dia-
blockchain technology. sometimes may also maturing ecosystem where long-term bratory drink. Mexicans also geo’s Don Julio and Bacardi’s
include companies that value trumps short-term hype,” Bahl said, retention,” Rahul Chowdhri, an investor However, the growth becomes unrea- celebrate their local spirits, and Jose Cuervo and Patrón.
have been acquired or citing examples like Cosmofeed, a creator- at Stellaris Venture Partners, said. sonable when a company burns excessive we wanted to get into this busi- Vikram Achanta, founder
have completely pivoted. It focused platform founded in 2021 that has While growth parameters may vary money to acquire customers outside its ness because there has been an and CEO of beverage consult-
is can be a useful for inves- sharpened its sales focus to acquiring based on the stage of the startup and its target market, or gives discounts more evolution in the way Indians ancy Tulleeho, said, “With the
tors and entrepreneurs to high-margin customers and revisited segment, Chowdhri outlined that on aver- than required, or aggressively expands drink tequila,” he said. influx of tequila and agave spir-
gain insights on specific internal processes to increase productiv- age, early-stage startups may need to show beyond areas of specialty. “As companies About $5 million has already its igniting curiosity across
industries, and mitigate ity and reduce costs. 3-4x growth a year, which can decrease to scale, we definitely look for more sustain- been deployed for production India, this category is on a good
potential risks in their own Private markets in recent times have even 50% growth at the time of exit. able growth (that enhances value without and white labelling; the rest will growth trajectory. Consumer
ventures. been forced to undergo a correction after As growth is fundamental to venture sacrificing financial health) that can be be spent on distribution and interest in understanding
a funding boom during the pandemic led investing, early-stage startups are repeated every year,” Basu said. expansion until the company tequila and its sister spirits
Sovereign cloud: A sov- Buffer overflow: Also to overvaluation of startups. Aggressive expected to deliver prolific growth to The course-correction is also aligned turns profitable in two years, he mezcal, sotol, raicilla and baca-
ereign cloud is a cloud known as buffer overrun, growth strategies fed by the with several series B-and-be- said. The next phase, when the nora is now higher than ever.”
computing environment buffer overflow occurs euphoria did not bear fruit CHALLENGING TIMES yond-stage fund investors
that addresses data resi- when the amount of data and, as a result, several start- who ask for more reasonable
dency, security and com- in the buffer exceeds its ups had to pivot their business PRIVATE markets A funding boom FUNDING declined valuations with a definite
pliance concerns specifi- storage capacity. In pro- models to reduce burn, or shut in recent times
have been forced
during the covid-19
pandemic led to
to $9.6 billion from
$25.7 billion over the
path to profitability. “Mid
cally for a country or juris- gramming, a buffer can be down operations. to undergo a overvaluation of 2022-23 period, and late-stage investors have
diction. Unlike traditional thought of as a container According to Bain’s latest correction startups according to Bain continued to hold the disci-
services provided by tech (or the allocated memory) venture capital report, fund- pline they had earlier. So,
giants, sovereign cloud that holds the data which is ing declined to $9.6 billion after a lot of excitement in the
solutions are hosted and to be processed. from $25.7 billion over the 2022-23 show that there is potential for disruption seed and series A levels, companies often
period, with mega-rounds plummeting in the market. “The ability to produce don’t get investors who will write cheques
from 48 to 15. such outcomes is more possible today as for very high multiples as they get into
5) Srini Venkatesan “Startups began several initiatives dur- every company in India has room to grow growth rounds,” said Yash Dholakia, part-
1) Nvidia 2) Nine 3) Kaspersky 4) Accenture ing the pandemic and the cost of market- because of the overall expansion of the ner at early-stage consumer focused firm
THE MONDAY QUIZ ANSWERS: ing was extremely high. Today, we are get- market, distribution channels and cus- Sauce VC.
ting the sense that margins are more tomer needs,” said Dipanjan Basu, Read an extended version of this story at
established and they are more focused on co-founder of Fireside Ventures. livemint.com
04 MONDAY, 24 JUNE 2024
NEW DELHI MARK TO MARKET LIVEMINT.COM

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

77209.90 0.28 23501.10 0.15 22236.20 0.10 71111.80 -1.09 24555.50 -0.07 45967.07 -0.20 51936.53 1.44
1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%) 1-MONTH CHANGE (%) 3-MONTH CHANGE (%)

4.40 6.29 4.31 6.77 4.95 11.75 4.21 20.70 4.18 8.95 6.43 18.92 8.49 22.72
6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%) 6-MONTH CHANGE (%) 1-YEAR CHANGE (%)

8.95 21.55 10.57 24.63 17.39 36.91 38.03 61.97 14.73 30.42 29.05 60.52 24.94 59.43

m MINT SHORTS
Japan’s retail investors bet on
Red-hot Dixon stock has risks too
yen rebound Manish Joshi
Good and bad nantly in the mobile phones wherein up from 36% to 45% over the last one
An army of retail traders appears to be reloading bets for feedback@livemint.com the Ebitda margins are thin. Mobile and year. Before retail shareholders get
The Mobile and EMS division had highest share in Ebitda for Dixon Technologies
a rebound in the yen as the currency’s slide increases the in FY24, but margin of this segment is thin
EMS divisions accounted for nearly 60% excited looking at the data, they need to

D
chances of Japan intervening in the market again. Bullish ixon Technologies (India) of the total revenue for FY24. The com- dig deeper. Mutual funds and foreign
FY23 FY24
positions on the yen against the dollar have been building Ltd investors are sitting on pany’s business is more of a volume institutional investors have done major-
Ebitda break-up (in  crore) Ebitda margin (in %)
since mid-May via futures contracts that cater to individ- handsome gains. The stock game rather than the margin expansion ity of their incremental buying during
ual Japanese investors, data from Tokyo Financial has delivered almost 150% 400 12 with focus on overall RoCE, which is March 2023 to September 2023, but at
Exchange Inc. show. These wagers tumbled on 29April in the last one year, and healthy at 34%. RoCE is return on capi- an average price of ₹4,095 per share.
and 1-2 May, around the time when the government is nearly 30% in the last one month. Dixon tal employed. The stock hit a new 52-week high of
300
thought to have stepped into the market, indicating that is engaged in electronic manufacturing 8
Historical trends suggest ₹11,679.90 on Friday.
retail traders sold the yen to take profit. With the yen services (EMS), and the prospects for the that over a five-year hori- STAYING Sure, the stock has found
dropping back toward 160 versus the dollar, retail traders sector are bright thanks to the govern- 200 zon, the company can give STEADY favour among investors, but
are on the edge of their seats wanting intervention, ment’s initiatives to boost manufactur- 30% CAGR in EPS. How- that doesn’t make it immune
according to Takuya Kanda, head of research at the anal- ing through various production-linked 4 ever, if the P/E after five THE company’s to risks. Though contract
ysis unit of Gaitame.com, a Japanese online brokerage. incentives (PLI) schemes. But there is a 100 years declines to 30x from business is more of a manufacturing does not
volume game rather
Trying to ride the government’s coattails to riches is a problem—the stock’s expensive valua- 100x currently, the return than margin involve marketing risk, the
risky strategy, especially for those using borrowed tion multiple, which could act as a deter- on investment in terms of expansion company’s revenue growth
0 0
money to amplify returns. BLOOMBERG rent to fetch meaningfully higher Consumer Home Security Consumer Home Security CAGR is a meagre 2%. Even rate is directly linked to the
returns from hereon, especially if earn- electronics appliances systems* electronics appliances systems* if the investment horizon is ANY tweaks in PLI prospects of its clients.
scheme would
ings growth fails to meet the Street's ele- Lighting Mobile and Lighting Mobile and pushed to 10 years and 30% have a direct Since the company is seen
products EMS division products EMS division
vated expectations. CAGR in EPS sustains dur- bearing on its as a key potential benefici-
Note: Ebitda is earnings before interest, tax, *50% of the JV
A recent analysis by Kotak Institu- depreciation and amortization Source: Company presentation
ing the period, the return on profitability ary of the PLI scheme, any
tional Equities seeks to illustrate this investments in terms of tweaks would have a direct
PRANAY BHARDWAJ/MINT
issue. There are 104 companies trading CAGR would be at 7%, bearing on its profitability.
at one-year forward price-to-earnings EV/Ebitda. The point that needs to be profit growth of a little over 30%. CAGR almost equal to the current government The company got PLI of ₹71 crore in
(P/E) multiple of greater than 50 times highlighted here is that the company’s is short for compounded annual growth bond yield for the same tenor assuming FY24 against ₹12 crore in FY23, with the
and nine companies with greater than P/E of 100 is after factoring in almost rate. The lower CAGR in net profit as P/E after 10 years at 15x. bulk of it coming from mobile phone
100 times P/E, according to Kotak. One 90% growth in Bloomberg consensus compared to the sales is because the Meanwhile, a look at the sharehold- PLI at ₹ 52 crore. Apart from that, a slow-
such company, with a P/E of 100, is EPS estimates for FY25. Ebitda margin in FY20 was 5.07%, ing pattern over the past four quarters to er-than-anticipated ramp-up of new
Dixon. The company has low debt and Coming to the financials, the com- which came down to 3.94% in FY24. March 24 shows that the institutional capacities and weakness in end user
there is no significant debt repayment, pany has grown its sales at a CAGR of The company is into contract manufac- investors have been aggressively buying demand due to change in technology
so P/E is a better valuation metric than 40% during FY20 to FY24, with net turing for various brands predomi- the stock. Their shareholding has gone are other downside risks.

Mark to Market writers do not have positions in the companies they have discussed here
Goldman Sachs forecasts US high-grade spreads ending
2024 at 90 basis points REUTERS

Credit’s strong run stumbles

for first time this year
Derivatives criteria rejig to guard retail investors likely this week
Global corporate bonds are on track for their worst
month since late last year by one measure, reigniting the Ram Sahgal added, could result in the num- On guard June) after public comments on and options contracts for a par- bility criteria bodes well for
debate about the relative value of credit versus other ram.sahgal@livemint.com ber of stock derivatives rising to Sebi's move comes against the same were received a day ticular underlying stock—on a investor interest,” said Siddarth
fixed-income classes. Spreads have widened by about 10 MUMBAI about 190 from 182 at present. rising retail interest in earlier,” the person added. rolling basis from ₹500 crore to Bhamre, head of institutional
basis points so far in June, from around the lowest levels “Derivatives stocks having low derivatives. SMAC refers to the secondary ₹1,250–1,750 crore; raising the research at Asit C. Mehta.

I
in three years, a Bloomberg index shows. Meanwhile, ndia’s capital markets regula- cash market liquidity can be cor- Net retail flows (in ₹ crore) market advisory committee, average daily delivery value in “It will prevent the tail from
yield premiums on those notes as well as US high-grade tor could issue a circular as nered on the F&O segment by a 26,820 which reviews developments in the previous six months from ₹10 wagging the dog,” he added, cit-
securities are rising from levels in May that were only early as this week tweaking few constituents who can influ- FY23 the secondary or cash market. crore to ₹30–40 crore; and ing how low concentration of
FY24
seen for less than 1% of the period since the 2008 global the eligibility criteria for cash ence the underlying share’s spot It is chaired by G. Mahalin- increasing a stock’s median traders in derivatives of thinly
financial crisis, the data show. While heavy spread wid- stocks to be listed on the deriva- price to the detriment of the gam, a former whole-time mem- quarter sigma order size from traded stocks could influence
ening would make credit less attractive compared with tives (futures and options) seg- retail investor,” the person ber of Sebi. Its members include ₹25 lakh to ₹75–100 lakh. (The the cash price. He added that
Treasuries, Goldman Sachs Group Inc. strategists led by ment, said a person aware of the explained. “Sebi’s move will safe- 9,184 chiefs of stocks exchanges, higher the quarter sigma order Sebi should also look at develop-
7,682
Lotfi Karoui don’t see that happening. The bank forecasts matter. The rationale is to align guard investor interest while 3,511 depositors, exchange forums size, the more difficult it is to ing the stock options market.
US high-grade spreads ending 2024 at 90 basis points the eligibility criteria with leading to orderly development and senior broking officials. manipulate a stock.) “It is the responsibility of stock
and junk spreads at 291, compared with current levels of parameters such as size and of the market at the same time.” Futures Options Queries emailed to a Sebi The criterion relating to pick- market intermediaries and the
Source: NSE
94 basis points and 314 basis points, respectively. “We’re liquidity of the cash market to This will be the first time since spokesperson remained unan- ing the stocks from among the regulator to educate the retail
PARAS JAIN/MINT
in this holding pattern of the macroeconomic backdrop, protect investor interest through 2018 that the framework would swered till press time. top 500 in terms of average daily investor so they invest and trade
which is not too hot, not too cold,” said Neeraj Seth, chief effective price discovery, the be changed, according to a con- (Sebi). Sebi had sought public The proposed changes market capitalization and aver- in an informed manner,” said
investment officer and head of Asia-Pacific fundamental person cited above said on the sultation paper on the subject comments on the review until 19 include increasing the market- age daily traded value in the pre- Gaurav Dua, senior VP, head-
fixed income at BlackRock Inc. in Singapore. That’s nor- condition of anonymity. issued on 8 June by the Securi- June. “The matter was discussed wide position limit—maximum ceding six months stays capital market strategy, Share-
mally a “good environment” for credit. BLOOMBERG The revision, the person ties and Exchange Board of India by the SMAC on Thursday (20 number of outstanding futures unchanged. “Tweaking the eligi- khan By BNP Paribas.

‘Many large IPOs likely in the second half of this fiscal year’ FPIs put ₹12,170 cr
Dipti Sharma
dipti.sharma@livemint.com
in equities in June
years on the back of a strong
pipeline of IPOs and QIPs
shifts may also influence M&A on IPOs. With elections
decisions. behind us, we expect the sec-
MUMBAI across sectors. With regards to Additionally, proactive ini- ond half of 2024 to be a very
M&A, robust global liquidity tiatives by the government to busy period. There are already PTI

T
he last financial year saw has provided strong buying promote clean energy will act more than 55 DRHPs filed feedback@livemint.com
around 80 IPOs in India, power with financial sponsors as a catalyst in the renewable with Sebi looking to raise NEW DELHI
the highest in a decade, and strategics alike. Financial energy space, and expanding about ₹70,000 crore.

S
though their average size sponsors are getting more product portfolios and opti- We are currently working taging a strong comeback
reduced slightly compared to comfortable to control deals as mizing supply chains to main- on a strong pipeline of IPOs after general election
FY23. However, Sonia Das- they now have multiple ave- tain a competitive edge may and QIPs across major sectors results, foreign investors
gupta, MD & CEO-investment nues to exit i.e. through M&As drive M&A in the industrials like real estate, industrials and pumped ₹12,170 crore in Indian
banking, JM Financial, expects as well as blocks in the market. sector. healthcare. Our current pipe- equities so far in June, mainly
many large IPOs to debut in Moreover, newer sectors are With the upcoming IPOs, line includes a good mix of driven by expectations of con-
the second half of FY25. emerging. are the valuations on the both small and large sized tinued policy reforms and sus-
Besides, in the mergers and Could you elaborate on higher side? Is valuation a transactions, many of which tained economic growth.This
acquisitions (M&A) space, the that and name a few? challenge when indices are we are expecting to hit the came following a net with-
veteran banker anticipates Deals are happening across around record highs? markets in the near future. drawal of ₹25,586 crore from
healthcare, financials, energy multiple sectors like manufac- While indices are around What is your current equities in May on poll jitters FPI inflows are concentrated

‘
and industrial sectors to wit- turing, Industrials, specialty record highs in the second- focus for the upcoming and more than ₹8,700 crore in in a select few stocks. HT
ness significant activity. Edited chemicals, digital and technol- market further heats up the financial advisor on the sale of ary market, in year regard- April amid concerns over a
excerpts from an interview: ogy, healthcare, consumer and M&A market. Early engage- Shriram Housing Finance Ltd the primary mar- ing M&A, tweak in India’s tax treaty with continuity added confidence to
financials. We are witnessing a ment, flexible deal structures, which is the largest all cash kets, almost all Deal momentum I P O s , a n d Mauritius and a sustained rise markets. Damania attributed
How does the equity capital range of new businesses enter- and a focus on win-win out- buyout transaction in the the IPOs in FY25 in traditional block deals? in US bond yields. three primary reasons for this
market and M&A land- ing the market. comes are the keys to unlock- affordable housing in India. have given posi- sectors of Are you priori- With the latest investment, positive inflow.
scape look like to you? For example, we recently ing success in India’s exciting We expect the trend to con- tive listing gains tizing larger the total outflow now stood at ₹ “First, the continuity of the
India is rapidly emerging as concluded IPOs of companies M&A market. tinue in the foreseeable future to investors financial services, players and 11,194 crore so far in 2024 (till government assures ongoing
a top contender in global like Ixigo, a B2C mobile travel Looking at the data, it with potential deals in high which indicate healthcare and IT bigger deals, June 21), data with the deposi- reforms. Second, the Chinese
equity capital markets. The platform for the next billion seems PE investments in quality assets across health- that issuers have has picked up. or are you tories showed. economy is decelerating, as
Indian equity markets have users and TBO Tek, a leading India have hit a multi-year care, consumer, IT, etc. left money on the focusing on Going ahead, Sunil Damania, evidenced by a 12% decline in
Sonia Dasgupta
delivered consistently about travel distribution platform, low. What is the present Which sectors might see table while pric- MD & CEO-investment
the quantity of chief investment officer at copper prices over the past
8-10% USD CAGR returns over both of which witnessed scenario? significant M&A transac- ing the IPO. banking, JM Financial deals? MojoPMS, said foreign portfo- month. Third, certain block
the last 20 years. This momen- strong listing gains. Last year, As per our internal data, on tions or block deals this Investors are FY24 was a lio investors (FPIs) inflow will deals in the market have been
tum has strong tailwinds we managed IPOs of compa- an overall basis, PE invest- year? willing to invest record year for remain constrained due to the eagerly taken up by FPIs,”
thanks to the strong macroe- nies in the ments in India We anticipate healthcare, in companies with solid funda- IPOs and QIPs in India. We high valuations currently com- Damania said.
conomic environment, earn-
ings growth trajectory, and
industrials
space like
m INTERVIEW (year to date)
are in line with
financials, energy and indus-
trial sectors to witness signifi-
mentals. They are clearly saw around 80 IPOs in FY24,
focusing on companies that the highest in the last decade.
manded by the Indian equity
market. FPIs had been waiting
However, these FPI inflows
are concentrated in a select few
equity market inflows espe- Happy Forg- last year (₹1 tril- cant M&A activities. Rising demonstrate near-term But the average size of IPOs on the sidelines for the election stocks rather than being wide-
cially from domestic mutual ings or a consumer tech story lion in 2024 as compared to disposable incomes and dem- growth and strong return met- had reduced slightly com- results. So far in 2024, barring spread across the market or
funds (MFs). Apart from like Mamaearth. ₹1.1 trillion in 2023). Overall, ographics are fuelling demand rics. pared to that of FY23. How- March (₹35,000 crore inflow), sectors. Additionally, the antic-
favourable demographics, var- What is your take on the PE investments in India in for quality medical services. What’s the current pipe- ever, we expect many large they have been pulling out ipation of a pro-growth budget
ious structural reforms in the M&A landscape? 2023 and 2024 are low as The availability of attractive line you are looking at, con- IPOs to hit the market in FY25 from India. “Though the gen- has also lifted investor senti-
past decade have also been The convergence of abun- compared to 2021 and 2022. assets and a positive sector servatively? How many in the second half. Many large eral election results were sort of ment, Himanshu Srivastava,
strong pillars for the faith in dant dry powder, economic Even so, in these years, large outlook will likely drive con- deals are you looking at in corporates have already filed a surprise and resulted in a Associate Director - Manager
this growth story. In FY24, JM optimism and favourable pools of capital were invested solidation among healthcare 2024? DRHPs with the regulator and weaker than expected man- Research, Morningstar Invest-
Financial closed around 56 demographics makes India an in technology and consumer delivery players, such as hos- Despite global economic many more are planning to file date, markets celebrated that ment Research India, said.
capital market transactions exciting and attractive desti- tech sectors (more than 50% in pitals and diagnostic chains. uncertainties, there has been a it in the near term. yet again a stable government is Trends in FPI activity in June
across IPO, QIPs, blocks and nation for M&As. Companies terms of deal value). Meanwhile, rising credit remarkable surge in IPO activ- We have a strong mix of formed and government conti- indicate buying in financial ser-
topped the equity league are vying for a limited pool of Deal momentum in tradi- demand will fuel M&A activity ity in the last 12 months, driven both small and large IPOs. We nuity is maintained,” Kislay vices, telecom and realty and
tables. In terms of primary attractive targets and this tional sectors of financial ser- in financial services. Compa- by investors’ confidence in the also have a robust pipeline of Upadhyay, smallcase manager selling in FMCG, IT, metals and
market outlook, we expect drives competition. Competi- vices, healthcare and IT servi- nies will leverage deals to Indian economy, strong QIPs as corporates are increas- and founder of FidelFolio, said. oil and gas, VK Vijayakumar,
strong momentum to con- tion from foreign companies ces has picked up in this envi- expand reach and acquire new inflows into domestic MFs, ingly looking to raise funds for Further, business sentiment chief investment strategist,
tinue over the next couple of looking to tap into the Indian ronment. We recently acted as customers, while regulatory and encouraging listing gains capital expenditure. remained buoyant, and policy Geojit Financial Services, said.
LIVEMINT.COM CORPORATE MONDAY, 24 JUNE 2024
NEW DELHI 05

International airlines hover Spectrum worth ₹96,318 crore

to be auctioned tomorrow
for a slice of Indian skies Gulveen Aulakh
gulveen.aulakh@livemint.com
NEW DELHI

I
ndia will put airwaves worth
₹96,317.65 crore on sale on
Total aircraft orders by domestic airlines are expected to expand India’s global footprint Tuesday as it begins this
year’s spectrum auction where
private sector telecom service
Anu Sharma providers Reliance Jio, Bharti
anu.sharma@livemint.com Airtel Ltd and Vodafone Idea
NEW DELHI Ltd (Vi) will compete.
The three carriers, with

I
ndia’s booming aviation market nearly 1 billion mobile phone
continues to draw interest from subscribers between them, are Sector watchers say Bharti Airtel and Vodafone Idea would be
global airlines, as they aim to serve together expected to spend looking to renew airwaves in some circles, while Reliance Jio may
smaller cities in the world’s fifth- anywhere between ₹4,000 and add airwaves in the 800 MHz band. MINT
largest economy where growing ₹16,000 crore to buy airwaves
prosperity is fuelling demand for air across 4G and 5G bands, MHz bands to 10-15 MHz, and Overall, about 17% of the
travel. according to estimates by bro- in the 2300 MHz band to 40 spectrum value is likely to be
The cumulative order for more than kerage reports. The depart- MHz. This could lead to a maxi- sold, which could be the lowest
1,600 aircraft by IndiGo, Air India and ment of telecommunications mum spend of ₹12,300 crore. in any auction since 2014. No
Akasa since 2023 is expected to fur- (DoT) will conduct the auction Besides renewal, Airtel will excess demand in any circle or
ther expand India’s international foot- to sell radio frequencies across add at least 25,000 5G sites in band is expected to be sold,
print, and domestic carriers have the 800 MHz, 900 MHz, 1,800 the circles of Maharashtra, Guj- implying that spectrum may be
often highlighted the role of tier-2 and MHz, 2,100 MHz, 2,300 MHz, arat, Madhya Pradesh and sold near reserve prices.
tier-3 markets in this growth trajec- 2,500 MHz, 3,300 MHz and 26 Chhattisgarh, Kerala and West The DoT has not included
tory. Now, global air carriers are also GHz bands. Bengal to improve rural cover- any spectrum in the 600 MHz
lining up to tap the potential in smaller Reliance Jio, Bharti Airtel age, for which it has adequate and 700 MHz bands in the
cities. and Vodafone Idea have collec- spectrum. upcoming auction. Spectrum
Last week, UAE’s Etihad launched tively submitted ₹4,350 crore Vodafone Idea, reserve prices
four weekly flights to Jaipur. And as earnest money deposit, which recently have been
Saudi carrier Riyadh Air, which is set according to DoT data. Reli- raised ₹18,000 The three carriers increased in
to launch in 2025, has also firmed up ance Jio, India’s largest telecom crore from what are expected to 3,300 MHz and
plans to begin flights to India by 2026. Last week, UAE’s Etihad launched four weekly flights to Jaipur. REUTERS firm, has deposited ₹3,000 was the country’s spend between 26 GHz bands by
So far, the airline has ordered 39 Boe- crore, while Bharti Airtel and largest follow-on ₹4,000 and 12% and 8.9%,
ing 787-9 aircraft, with an option for stand what capacity may be available increased 22% year-on-year to 69.64 should happen during 2025-26.” Vodafone Idea deposited public offer, has
₹16,000 cr to buy r e s p e c t i v e l y .
33 more. for flights to Gatwick,” he added. million passengers in FY24 while Chai Eamsiri, chief executive officer ₹1,050 crore and ₹300 crore, decided against Reserve prices of
“India is in our top three target mar- India’s international aviation mar- domestic traffic grew nearly 14% to of Thai Airways International, said, “In respectively. renewing some its airwaves across the 1,800MHz
kets of the world; it is a massive oppor- ket has received a major boost lately, 306.8 million. terms of the number of cities we ser- The deposits mean that each spectrum in the 4G and 5G bands band have been
tunity. We see potential and opportu- thanks to aggressive expansion efforts Adam Boukadida, Riyadh Air’s chief vice, India is our biggest market. We telco can bid three to four times circles of West increased largely
nity in the secondary cities. We have by carriers such as IndiGo, Air India financial, said, “India is an important already fly to all the major cities and the amount. However, sector Bengal and Uttar in Uttar Pradesh
also seen affluence increasing—peo- and Vistara since covid-related market for us. We will use both wide- have a plan to operate in secondary watchers say that Airtel and Pradesh West, where renewals East. Spectrum base prices
ple have more money to travel. cities. We have to wait for the new Vodafone Idea would be look- for 12 MHz in the 1800 MHz have been raised by 11-14% in
The future is very clear,” Jonathan SOARING PROSPECTS narrow-body aircraft for that.” ing to renew airwaves in some and 900 MHz bands were due. bands or circles that saw
Pollard, chief commercial officer General Willie Walsh, director circles, while Jio may add air- Therefore, it would end up demand in the 2022 auctions.
of London Gatwick Airport, told RIYADH Air, set to NUMBER of int’l GLOBAL traffic at THE domestic of the International Air Transport waves in the 800 MHz band. reducing its spend on renewals The auction, which was orig-
Mint. launch in 2025, has airports in the Indian airports air traffic in India Association, said at the IATA Avia- Jio is expected to spend about from ₹1,500 crore to ₹200 inally scheduled for 20 May,
also firmed up plans country rose from increased 22% y-o-y grew nearly 14%
The airport, which currently to begin flights to 35 in March 2019 to to 69.64 million to 306.8 million tion Summit at the start of June, “I ₹3,700 crore as it may increase crore for just the 900 MHz has been postponed twice to
serves 24 Air India flights a week, India by 2026 40 by March 2024 passengers in FY24 in FY24 am hugely optimistic about the its spectrum holding in certain band. finally take place on 25 June.
has also begun talks with India’s opportunity in India. I am amazed circles in the band. The auction is expected to be While Mint had reported
largest airline IndiGo, which with how much potential exists Airtel could spend a mini- limited in scale compared to earlier this year that the gov-
placed an order for 30 wide-body air- restrictions were eased in March body and narrow-body aircraft for this here. In 2000, the Indian domestic mum of ₹3,800 crore as it will the 2022 bids, which generated ernment is expecting to mop
craft in May. “We are aware of 2022. According to data from the Air- market. For us, partnering with Indian market represented 0.4% of global have to renew 42 MHz of spec- a record ₹1.5 trillion from the up about ₹10,000 crore from
IndiGo’s wide-body order. Naturally ports Authority of India (AAI), the carriers will also be important for aviation; last year it was 1.8%. It is trum in the 1800 MHz and 900 sale of 72,097.85 MHz of radio the sale, various brokerage
we will be making a case to IndiGo and number of international airports in depth of network, so we will be part- growing quickly. [The potential] will MHz bands in six circles, Jeffer- frequencies. The reason for the reports leading up to the sale on
others who have the capacity to fly to the country rose from 35 in March nering with Indian airlines to connect only be unlocked with the right gov- ies said in a note. It may also bid high bids was that 5G auction 25 June said the auctions may
London. The team has also engaged 2019 to 40 by March 2024. Interna- more cities. We hope to connect India ernment policies and I suspect this in certain circles to increase its was being put on sale for the fetch the Centre ₹4,000 crore
extensively with Air India to under- tional traffic at Indian airports within 12 months of our launch so it will happen in time.” holding in the 800 MHz/1800 first time. to ₹16,600 crore.

Third Episode of Crafting Bharat

Mint Media Marketing Initiative

Podcast Series Delve into the Indian Startup Ecosystem

Sanket Shah, CEO of InVideo discusses his founder journey, building AI enables video editing software
and upcoming trends in the industry.
The startup industry of AI enabled video editing InVideo from a tech journey for fun. The gratifi-
India is flourishing, espe- software and upcoming standpoint? cation point of this journey
cially rising entrepreneur- trends in the industry. is not the money you will
ial drive amongst the Explore the tales of Indian If the creators can create get later, because most
younger generation of Startup founders’ transfor- videos in a very natural en- likely you might not earn
India. With numerous suc- mation from dreams to vironment that’s what I money.
cess stories, the Indian reality, navigating chal- think gets to a billion
startup ecosystem has wit- lenges to seize opportuni- users. It is a series of sta- Is it a better approach to
nessed a remarkable ties through the Crafting bility, how it’s distributed release a good product
increase in venture capital Bharat Podcast Series. and how it can all be tied and improve it to perfec-
investments, attracting together. The future of all tion with feedback
both local and global Edited Excerpts: the software is in the received?
investors. browser and it is also
Segment 1: across all devices. Our In my opinion there needs
The "Crafting Bharat - A The Incubator entire system works on to be a judgment and a
Startup Podcast Series" AWS and the scaling was time to launch but the ear-
powered by AWS, and an Between the 2012 to very smooth. AWS sup- liest you go out is the best
initiative by NewsReach, 2017 phase how did your ported us in a very early for the business.
in association with VCCir- seed of an idea for stage.
cle, unlocks the secrets InVideo germinate, The startup ecosystem in
behind these successful considering you had Sanket Shah, CEO of InVideo discusses his founder journey, building AI enables video editing software Segment 2: India has grown tremen-
entrepreneurs’ journeys founded Visify Books and upcoming trends in the industry with host Gautam Srinivasan. The Accelerator dously in the last decade.
aiming to equip aspiring and MassBlurb (with The increasing adoption of
entrepreneurs and busi- Pankit) in the mean- you to start a recurring that drove investors You met Sam Altman of digitization coupled with
ness enthusiasts with while, and how did it business. That was my to you? OpenAI recently. What government initiatives
invaluable insights. The evolve further in the biggest mistake to think did you two talk about? have opened new ave-
podcast series is hosted 2017 to 2019 period? that way. I never got a clo- First, We operate in a bot- nues for budding entrepre-
by Gautam Srinivasan, Give us the highlights sure from Visify Books. I tomless market; the I met him for over 2 hours, neurs.
famed for hosting a when it comes to the ups thought that videos should Analyzing the market is extremely large. and it was a fun conversa-
diverse range of TV and and downs? not be made like this and I believe that over a billion tion. We briefly talked Stay tuned to the Crafting
digital programs, currently
I was thinking about start-
sometime in 2017 I started competition is people in the world are about what to expect in the
future. There will be a
Bharat Podcast Series as
we bring you these inspira-
consulting editor at CNBC InVideo. going to create videos and
(India), CNN-News18,
Mint, HT Media, Forbes
ing a business in India
while I was in the US, but I Your seed round in May
part of the I don’t think there is any
debate there. Second, it
requirement of more elec-
tricity for advancement in
tional entrepreneurs for
insightful and candid dis-
India, and The Economic think that’s not how it the world of AI, which cussion with Gautam Srini-
Times. works because to do a
2018 and the second one
in October 2019 were
strategy. comes down to confidence
in the founder. Track hopefully will get solved by vasan.
business in India then you tepid. But the third record and talking to the nuclear fusion. Second, is
Given the importance of need much deeper Indian round in Feb 2020 Business founder gives that confi- that compute has become Scan the QR Code to
artificial intelligence (AI) in insights. You need to be in brought in $2.5 million, dence to the investors to extremely important. Watch the full episode
today's technological con- India and work here, you that helped you launch outcomes result invest.
text, a seasoned entrepre- can’t sit somewhere else your automated What do startup found-
neur Sanket Shah, CEO of and think that I will start a
recurring business in
assistant, then in from executing I read somewhere that ers need to focus on
when thinking of the
InVideo, is changing the October 2020 you got you are now the largest
way people create video
content. In the Crafting
India. In 2014, there was
NACH where you needed
another $15 million as
Series A, and then the
that strategy. prosumer SaaS compa-
ny in Asia. What are the
risk?

Bharat Podcast Series, to fill a form and submit it, biggie, $35 million in lessons that you have It’s very risky. I do not think
Shah talks about his for them to initiate recur- July 2021 for Series B. learnt in scaling up you can do this journey for
founder journey, building ring payments allowing What changed in 2020 money. You pick up this
06 MONDAY, 24 JUNE 2024
NEW DELHI CORPORATE LIVEMINT.COM

Apple, Meta have discussed Adani plans $3 bn

foray into pumped
a generative AI partnership storage business
FROM PAGE 1
The Nifty ended down 0.28%
at 23501.10 on Friday. MINT can fund about 5.5GW capac-
The discussions highlight the unlikely alliances forming between major tech cos in the AI era ity, according to the two per-
Derivatives Salvador Rodriguez
sons.
In FY24, AGEL commis-
a rare olive branch between the social- sioned about 3GW, with a
mkt signals feedback@livemint.com media giant and the iPhone maker.
Meta launched Llama 2, its large lan-
credit revolving facility of $1.6
billion, which has been

a decline
I
n its hustle to catch up on AI, Apple guage model, in July 2023, and in April, increased to $3.4 billion now
may be turning to a longtime rival: the company released the latest ver- by a consortium of 25 interna-
Meta. sions of its AI models, called Llama 3. tional and domestic banks. If
this week Facebook’s parent has held dis-
cussions with Apple about integrat-
While Llama has gained support and
adoption within the tech industry and
utilized, this is sufficient to
develop 6–8GW, the two peo-
ing Meta Platforms’ generative AI among startups, a deal with Apple ple added.“Once the assets sta- PSH will be key to India’s green
FROM PAGE 1 model into Apple Intelligence, the would represent a major victory for bilize, the facility is refinanced energy push. REUTERS
recently announced AI system for Chief Executive Mark Zuckerberg and with a long-term dollar bond.
21 December. While the flip has iPhones and other devices, according his company’s AI division. The idea is to issue bonds with Tata Power CEO Praveer
happened again this time, bro- to people familiar with the matter. Tensions between the two companies fixed coupons and with a long- Sinha saying that the company
kers expect a smaller and Meta and other companies develop- have persisted for more than a decade. term amortization structure— was looking to set up 2.8GW of
shorter pullback of around ing generative AI are hoping to take Most notably, Apple in 2021 introduced where the cash flows are fully PSH capacity by FY29 with an
2-3% from Nifty’s latest closing advantage of Apple’s massive distribu- privacy changes to its mobile devices that aligned with debt servicing. investment of ₹15,000 crore.
of 23501, as markets tend to run tion through its iPhones—similar to Meta later said would cost it $10 billion in AGEL’s RG1 dollar bond In November 2023, a Mon-
up a week or two ahead of a what Apple offers with its App Store on lost revenue in 2022. In April, Meta pub- issued in March 2024, eycontrol report said state-run
Union Budget. the iPhone. lished instructions encouraging advertis- received a seven-times partici- NTPC Ltd had identified at
“While a pre-budget rally is A latecomer to generative AI, Apple ers to use a workaround to avoid paying a pation from international least nine states where it
anticipated, it might be pre- has developed its own smaller artificial- When Apple Intelligence was unveiled earlier this month, OpenAI’s ChatGPT was 30% service charge to Apple for “boosted investors,” said the second planned to build PSH units
ceded by an immediate, shal- intelligence models but has announced announced as the company’s first partner. BLOOMBERG posts,” a form of advertising that the two person. with a total installed capacity
low fall of 2–3% to it will turn to partners for more complex companies bickered over for years, The As India, the third largest of 14GW.
23,000–22,800,” said Dhiraj or specific tasks. When Apple Intelli- in the artificial-intelligence era. of ChatGPT through Apple Intelligence, Wall Street Journal has reported. emitter of carbon dioxide after In December, the govern-
Relli, managing director and gence was unveiled earlier this month OpenAI’s tech is set to be embedded in but users can also link a premium By holding discussions with a range China and the US, moves on its ment had cleared Greenko
chief executive officer of HDFC at the company’s Worldwide Develop- Microsoft and Apple devices. ChatGPT account to their Apple device. of AI companies, Apple is able to avoid renewable pledge Energy’s pro-
Securities. “I believe from that ers Conference, OpenAI’s ChatGPT was And an Apple and Meta deal would While ChatGPT usage is expected to becoming overly reliant on OpenAI. But of net zero by In January, the posal for a
level, we could see the market announced as the company’s first part- be noteworthy given how much the double with the Apple partnership, it remains to be seen how open Apple 2070, PSH is government 3.66-GW PSH
rally and test re-test today’s (21 ner. “We wanted to start with the best,” two companies have been at logger- OpenAI’s infrastructure costs are will make its new AI platform available emerging as a big cleared eight PSH project in Uttar
June) life high (23667.10).” The said Apple software leader Craig Fede- heads over other emerging tech issues. expected to grow 30% to 40%, said to these external AI companies. These part of this push. projects worth Pradesh’s Son-
Nifty ended down 0.28% at righi, noting that ChatGPT “represents In its talks with other AI companies, Gene Munster, a longtime Apple ana- AI deals take time because for now they In January, the bhadra district
23501.10 on Friday. Relli said Apple hasn’t sought for either party to lyst and managing partner at Deepwa- government
₹81,981 crore in
the best choice for our users today.” He have to be struck on a per-company according to
investors were moving out of also said Apple wanted to integrate pay the other, the people said. Instead, ter Asset Management. Munster basis, unlike the App Store where an cleared eight PSH five states, as per MoEFCC.
auto and PSU stocks to defen- Google’s Gemini as well. the AI companies expects 10% to 20% established process exists in which projects worth the MoEFCC Two projects in
sive sectors like private banks In addition to Google and Meta, AI can sell premium of Apple users will developers can more freely submit their ₹81,981 crore in Chhattisgarh
and fast-moving consumer startups Anthropic and Perplexity also subscriptions to opt into paying for a apps for Apple’s approval before show- five states, with a capacity of
goods, which could spark a pre- have been in discussions with Apple to their services premium AI sub- ing up in its digital storefront. according to the ministry of 1.2GW each, by Sterlite Grid
budget rally next month. Kruti bring their generative AI to Apple through Apple Intelligence. As it does scription to a product like ChatGPT. Apple’s Federighi said it makes environment, forest and cli- and Gandhwani Energy, have
Shah, quant analyst at Equirus Intelligence, said people familiar with on its app store, the iPhone maker That could mean billions of dollars for sense for the company to offer numer- mate change or MoEFCC. also received recommenda-
expects the flip to result in a fall the talks. would keep a cut of subscription reve- AI companies that integrate success- ous AI options because users will pre- The Adani Group’s closest tions. Another 2.22GW project
to 23000, which she calls a If Apple strikes deals with partners nue from its devices. fully with Apple’s new platform. fer different models for different tasks, rivals Tata Power, NTPC, and by Oju Subansiri Hydro Power
“good level” to enter the mar- beyond OpenAI, Apple said customers The discussions haven’t been final- “Distribution is hard to get,” Munster such as creative writing or researching JSW have already announced Corporation in Arunachal Pra-
ket. “I believe that sectoral could choose which external AI models ized and could fall through. Even said. “The beauty of what Apple has medical information. “People are plans to enter the PSH space. desh and a 1.5GW project by
churn will happen, but midcaps they want to use in addition to Apple’s though deals with Apple would help AI built is that you’ve got this engaged dis- going to want to draw on that kind of The Ahmedabad-based con- JSW Energy in Maharashtra
could continue to outperform internal systems. companies obtain massive distribution tribution at scale.” expertise that might not be part of our glomerate’s capex target, have also got clearance, as per
the large caps,” said Shah. She The discussions with Meta highlight of their products, it is unclear how A partnership with Meta would help core,” he said at the developers confer- though, is the highest. MoEFCC.
expects markets could run up the unlikely alliances that are forming much of a financial windfall it would be. elevate the stature of its efforts in the ence earlier this month. On 19 February, a report in For a longer version of this
to 24,200 in a pre-Budget rally between major technology companies OpenAI will be offering a free version tech industry’s AI race and represents ©2024 DOW JONES & COMPANY, INC. The Economic Times quoted story, go to livemint.com.
after an initial dip.

Six MNC units face Lawsuit, Cannes win put focus on JSPL ad
ownership checks FROM PAGE 1 When asked, a spokesperson
from Jindal Steel said, “Jindal
larger competitor in the indus-
try, under the pretext of bizarre
nes Lions in the Film Craft cate- Steel cannot comment on the accusations of copyright
FROM PAGE 1 Action Task Force (FATF), a gory. This was despite the amicable settlement as it is infringement and lack of origi-
global standard-setter in the ongoing legal and ethical ques- bound by confidentiality. How- nality. Kondurkar Studio
tures. Not all of them are for fight against money launder- tions about its origin, rekin- ever, we clarify that the ‘The developed this film based on
wrongful purpose and in many ing, financing of terrorism and dling the debate over who Steel of India’ campaign is our the client’s brief, aiming to
cases, it may be for efficiency in proliferation of weapons of rightfully owns the idea behind original idea, and we engaged bring alive the Indian resilience
taxation or in organizing busi- mass destruction. the campaign. Kondurkar Studio and Early- to land on the brand line of ‘The
ness. Be that as it may, who is The first person denied that Piyush Pandey, legendary man Films to bring our vision to Steel of India’. The film, which
controlling the business should enforcement of beneficial own- adman and adviser at Ogilvy life.” signs off with ‘The Sound of
not be hidden. It is the duty of ership reporting norms affects (former executive chairman), Incidentally, Amrish Kon- India’, is entirely original. We
the company to identify and ease of doing business, saying called this a sad incident for the durkar, the founder of Kondur- had no prior knowledge of any-
RBI’s monetary policy committee expects GDP growth at 7.2% for report its beneficial owners,” that insufficient regulation industry. “While it’s a difficult kar Studio who was named in thing that the larger agency
FY25, lower than the 8% growth seen in the previous fiscal. MINT said the person quoted above. dealing with complex corpo- interpretation, my theory is A screengrab from JSPL’s ‘Steel Cannes for idea creation, was might have earlier shared with
“Companies have to come rate structures was responsible simple: the idea belongs to the of India’ campaign. YOUTUBE/JSPL part of W+K until January our client. The Delhi high

Why Varma, Goyal clean on who is owning them. It

is like an internal know your
customer (KYC) for them,” the
for the global financial melt-
down of 2007-08.
Experts pointed out that
one who created the idea,” he
told Mint. “If the entire concept
is under suspicion, then every-
theft at all, as he just opened the
lock.”
2023, when he started his own
company.
Defending their work, Kon-
court, after thorough adjudica-
tion, found no wrongdoing on
the part of Kondurkar Studio.”

voted for a rate cut at person said.

Emails sent to the ministry of
corporate affairs and to the
beneficial ownership needs
special attention from busi-
nesses. Regulations lay the
thing about it is invalid. Which
is how Kyoorius looked at it.
Cannes decided to look at it
In an official statement on
Friday, W+K India said, “The
Delhi high court verdict clearly
durkar Studio said, “In recent
weeks, Kondurkar Studio and
its founder, Amrish Kondurkar,
The controversy under-
scores the challenges and com-
plexities of intellectual prop-
RoCs on 18 June and to Sam- responsibility of disclosure on another way and awarded the stated that prima facie the cam- have been subjected to a wave erty in the creative industry,
the MPC meeting sung and Linkedin on Friday
seeking comments for the story
remained unanswered at the
the individual...and if the com-
pany is of the view that a person
is an SBO and falls within the
campaign in the Film Craft cat-
egory and not for the idea. The
way I look at it is, if there is a
paign was substantially similar
to what we had presented to
Jindal Steel, be it the theme,
of negative, unfounded, and
unsubstantiated media cover-
age regarding the ‘The Steel of
raising important questions
about the protection of creative
ideas and the responsibilities of
FROM PAGE 1 MPC’s key external members time of publishing. eligibility criteria which are relay race and the third runner use of steel, visual imagery, or India’ campaign. Kondurkar agencies and clients in safe-
and the three RBI members. A second person, who also shareholding, voting rights or drops the baton, but the fourth sound design. The matter was embarked on an independent guarding them.
expects GDP growth at 7.2% for While RBI members consider it spoke on the condition of ano- control, explained Sandeep runs it best, the team can’t subsequently settled out of journey with integrity and cre- As the debate continues, the
FY25, lower than 8% growth appropriate to take the leeway nymity, said that the emphasis Sehgal, partner-tax at AKM claim victory. Ultimately, one court to the mutual satisfaction ativity, dedicating his talents to industry watches closely to see
seen in the previous fiscal. provided by strong growth to on enforcement of provisions Global, a tax and consulting has to see whose idea it was. If of both parties. Now the pro- creating original and impactful how this case will influence
The other MPC member focus on bringing inflation on significant beneficial own- firm. there is a theft, the person who duction house is coming and work. Despite his commenda- future dealings and the broader
Ashima Goyal, who voted for a down durably, the dissenting ership comes in the context of a For a longer version of this breaks open the locker can’t challenging us, claiming it’s not ble efforts, he and his studio are ethical standards within the
rate cut for the first time in the external members argued that country review by the Financial story, go to livemint.com. claim he is not connected to the our idea.” being unfairly targeted by a advertising landscape.
last policy, believes the it is time to prioritize growth as
approach to inflation target has economy is growing at below
not been affected by any new its potential growth rate.
supply shocks since the last According to the minutes,
policy. She argues that main- Varma argued that keeping 2%
taining status quo for too long real interest rate—difference
Europe’s response to China shock 2.0: Hold China closer
will result in keeping real repo between repo rate of 6.5% and
rate higher than necessary. inflation of 4.5%—for too long FROM PAGE 1 China. Europe’s manufactur- eign investment as a way to turers to grow in Europe could
“In the April will hurt growth ing sector has a lot to lose. Why import new technology. Now, help European manufacturers
policy, the possi- Both Jayanth for next two years. could strengthen as the U.S.’s risk that? Europe’s car indus- said Barkin, “We are in a posi- by encouraging more people
bility of new sup- Varma and That said, both weaken. And Chinese car try is deeply intertwined with tion where Europe is keen for to switch to EVs, and govern-
ply shocks was Ashima Goyal Varma and Goyal brands will play an increas- China’s already through joint transfers of technology to flow ments to build charging infra-
high and I was agree that a 4% agree that a 4% ingly important role in ventures that have a large in the other direction.” structure, some analysts say.
waiting to see inflation target Europe, but no role in the U.S. share of China’s market. About China is likely to produce Another advantage: The U.S.
inflation target
their impact. can be achieved The EU’s approach “accepts a third of Volkswagen ’s sales seven million battery-pow- electric-vehicle market could
International oil can be achieved on a sustainable that the China-EU industrial and a big share of its profit are ered EVs this lag behind
prices were rising, sustainably basis. complex exists and is explicitly in China. year, up from five The U.S. electric- E u r o p e a n d
there was uncer- “Yes; as expec- trying to encourage more of Moreover, Europe has more million last year, vehicle market China’s, with
tainty related to tations converge it,” said Jacob Kirkegaard , to lose than the U.S. from a said Ferdinand could lag behind inferior technol-
the monsoon, impact of heat to the target and it is also inter- senior fellow with the Peter- breakdown in global trade. It Dudenhoeffer, a Europe and ogy and higher
waves and elections. Most of nalized by price regulators, 4% son Institute for International has two-and-a-half times as German auto prices.
these are resolved without cre- target can be sustained. As the
China’s, with
Economics. many manufacturing jobs, and industry expert. Given the risk
ating new supply shocks. The economy diversifies and deep- This poses risks for Europe, more than a third of its manu- Europe is likely to inferior if Trump is
heatwave has had less than ens, supply shocks become less said Noah Barkin, Europe- factured goods are exported, Europe’s car industry is deeply intertwined with China’s through produce 1.2 mil- technology re-elected,
expected impact on food pri- volatile and have reduced China expert at Rhodium: “If versus one-fifth for the U.S., joint ventures that have a large share of China’s market REUTERS lion this year, Europe should be
ces,” said Goyal. “If inflation impact...,” said Goyal. the European car industry former Italian Prime Minister down from 1.5 more open to
continues to fall and expected Varma said, “The disagree- remains deeply integrated Mario Draghi said in a speech and machinery that helped to many and Japan combined. million last year, he said. This China as a hedge, Dudenhoef-
inflation is approaching the tar- ment is only about the pace at with China and the U.S. indus- this month. power China’s rise. But China “The first China shock was a advantage of scale enabled fer said. “Chinese manufactur-
get with growth at 8%, it means which this last-mile disinflation try is completely decoupled Manufacturing comprises increasingly competes in net positive for Germany,” said Chinese manufacturers to ers will help us go faster into
we can safely grow at such should be carried out. ...[S]ince from China, that is likely to 15% of Europe’s overall output, products it used to buy from Moritz Schularick, president move ahead of international the future…The big growth
rates,” she added. the excess over the target is lead to bilateral tensions and 18% of Germany’s, com- Europe. Its companies pro- of the Kiel Institute for the competitors in technology for region is Asia, not the U.S.,” he
The policy minutes released small, we can be more relaxed between the EU and U.S.” pared with 11% of the U.S.’s, duce more industrial World Economy. “The second electric vehicles, including said.
on Friday revealed a wide about the pace so as to reduce Indeed, Europe exports twice reflecting specialization in machines and equipment than shock is a real wake-up call.” batteries. ©2024 DOW JONES & COM-
divergence in views between the growth sacrifice.” as much to the U.S. as it does to high-tech engineering tools their rivals in the U.S., Ger- China once welcomed for- Allowing Chinese manufac- PANY, INC.
LIVEMINT.COM CORPORATE MONDAY, 24 JUNE 2024
NEW DELHI 07

BII to invest
$300 mn in Internal demand needed to
Indian EV
space
fuel India’s space economy
PTI
feedback@livemint.com
NEW DELHI In December last year, the department of space valued India’s space market at around $8 bn

B
ritish International Prashant Ruia, director of Essar Capital, which manages the
Investment (BII), the Shouvik Das group’s portfolio of investments. MINT
UK’s development shouvik.das@livemint.com
finance institution, is betting
big on the Indian electric vehi-
NEW DELHI
Essar awaiting final
A
cle (EV) ecosystem and expects t a closed-door gathering
to invest another $300 million
in the next three years, accord-
ing to Abhinav Sinha, its man-
in Bengaluru on 14 June,
Indian Space Research
Organisation (Isro) chair-
nod on Saudi plant
aging director (MD) and head of man S. Somanath said that
technology and telecoms. the fledgling domestic space industry PTI for steel for such cars as well as
The company, which has needs to “create an internal demand feedback@livemint.com for other consumer goods.
backed the Mahindra group’s and market.” NEW DELHI Essar, which turned debt-
EV arm besides other startups Somanath’s statement underlined free two years back after sell-

T
like Euler Motors, Turno and the ongoing plight that industry stake- he Essar Group is await- ing some infrastructure assets,
Battery Smart, has already holders feel could see the Indian space ing final approvals to is investing in decarbonization
invested around $300 million economy underperform against reve- start investing about projects and green mobility to
in the Indian EV sector and sees nue projections, and in turn, also ham- $4.5 billion in building a low- fuel the next growth phase.
further investment opportuni- per early-stage private space startups. carbon steel plant in Saudi The Saudi Arabia plant will
ties in EV manufacturing, com- Stating that demand for space Arabia, a top official said. be the group’s first steel
ponents and financing seg- launches will not “come from outside,” The approvals are expected project outside India. The
ments in the country. Somanath, who is also the secretary in anytime now, after which the metals-to-infrastructure con-
“India has quite an evolved the department of space, said at the conglomerate will start work- glomerate earlier owned and
auto market... On the EV side, gathering that at the moment, there is ing on the 4 million tonnes per operated an integrated steel
the penetration right now lags “no demand” for Isro’s workhorse annum steel plant along with plant in Hazira, Gujarat, which
the rest of the world... The rocket, the Polar Satellite Launch Vehi- port facilities at Ras Al-Khair. it lost to ArcelorMittal in an
(overall) penetration of EVs in cle (PSLV). The latter conducted three Isro’s PSLV conducted three commercial launches in each of the past two years for various central government divisions and “We still haven’t got all the insolvency battle.
India is something like 6% and commercial launches in each of the agencies. Nearly six months into 2024, Isro has not conducted a single commercial launch mission for any Indian entity PTI final approvals,” The work on
we see it quite easily expand, past two years for various central gov- Prashant Ruia, Essar is looking the project will
double and more than double ernment divisions and agencies. Nearly the value of the local industry, including ply by building a rocket based on funds of how government bodies pursue director of Essar to tap into Saudi start after receiv-
quite quickly,” Sinha told PTI in six months into 2024, Isro has not con- orders from within India as well as from issued to it from the ministry of finance. space missions. “No global space econ- Capital, which Arabia’s demand ing all the neces-
an interview. ducted a single commercial launch outside, at $44 billion by 2033. This central issuance model worked omy has ever been successful without manages the for steel for sary approvals,
He added, “The leader today mission for any Indian entity. In December last year, the depart- well purely because any government- the government being the primary cus- group’s portfolio Ruia said, adding
is China, but for India to be sig-
electric vehicles the company
To be sure, a ‘commercial’ launch ment of space valued India’s space mar- affiliated body under any ministry could tomer for public as well as private sec- of investments,
nificantly ahead of where it is pertains to satellites that are not built ket at around $8 billion. This accounted simply ask for satellite launch capacity tor firms. In India, government depart- said in an inter- as well as other already has the
today...we think it’s a very by Isro for scientific research for around 2% of a global $400 aboard an Isro rocket depending ments and agencies under vari- view with PTI. consumer goods land for the mul-
achievable sort of an objective... purposes. billion space industry—a fig- on their need. Now, this ous ministries are conflicted The plant will tibillion dollar
So we’re quite bullish.” This has created an ure that In-Space expects model has moved to a regarding the allocation of meet domestic project.
Sinha was responding to a
query on how BII sees the EV
issue. Back in October
2022, consultancy firm $13 bn
Projection for India’s
to balloon to 8% within demand-driven model,
the next decade. wherein Isro would sup- $44 bn
In-Space’s estimate
funds to Isro, which is
creating this said
steel demand in Saudi Arabia. The plant will take three to
“Saudi Arabia is going three-and-a-half-years to
ecosystem in India compared EY India and industry While 2033 still ply rockets only based on demand shortage in the through a large growth phase. build.
to the other markets in the body Indian Space Asso- pvt space economy remains far away, indus- the demand that they see for the local space market. In short, there is A large part of steel today is The integrated steel project
world and investment oppor- ciation (Ispa) projected by the end of CY25 try stakeholders believe from the market,” said industry by 2033 no single body with bud- getting imported into Saudi will be executed through Essar
tunities in the country. that India’s private space both the above-mentioned Narayan Prasad Nagendra, get allocation available to Arabia. So, this is basically a arm Green Steel Arabia over a
By 2030, he said there will be economy will be valued at $13 projections are well off-tar- chief operations officer at enable commercial space domestic plant,” Ruia said. land parcel of 1,000 acres in
a “massive level” of EV penetra- billion by the end of calendar year get. The reason for this is an Dutch space firm Satsearch. projects within Isro,” the official The oil-rich kingdom is eye- Saudi Arabia’s Ras Al-Khair
tion in public transportation in (CY) 2025. In October last year, govern- apparent change to the way space pro- Nagendra’s assessment is on point. A said. ing becoming an electric vehi- province.
India and there will be “quite a ment-affiliated space promotions body jects were allocated in India. senior official close to developments at Isro did not respond to an emailed cle manufacturing hub, mak- Essar also plans to invest in
bit of traction on the passenger Indian National Space Promotion and “Until last year, space missions in Isro told Mint on condition of anonym- query from Mint. ing more than 300,000 cars constructing two dedicated
(electric) cars, as more and Authorization Centre (In-Space) put out India for Isro worked on a supply-driven ity that the demand-driven model in Read an extended version of this story annually by 2030. Essar is berths at Ras Al-Khair port
more people adopt it”. a decadal vision, wherein it projected model, wherein Isro would create sup- question has created conflicts in terms at livemint.com. looking to tap into the demand exclusively for its steel project.

ONGC offers stake in Deen Dayal gas field Have fun

with facts
PTI
feedback@livemint.com
lion cu. ft of in-place gas partner who could help with
reserves—by far the biggest in the development of DDW.
on Sundays
NEW DELHI any deepsea field in the coun- Besides the acquisition cost, Catch the latest column of

try—but later trimmed to a ONGC has spent an unde-

A
A
fter spending close to tenth, has proved to be clared sum of money in trying
A quiz on the week’s development.
$1.2 billion and seven tougher than anticipated. to bring the DDW field to pro-
years of little success, “A total of seven develop- duction.
state-owned Oil and Natural ment wells are drilled till GSPC holds a 10% sake in
Gas Corp. Ltd (ONGC) is seek- date,” ONGC said in the tender the field and the remaining is
ing partners to rescue the document. with Jubilant
Deen Dayal gas field in the A development Since ONGC Enpro.
Krishna-Godavari (KG) basin well is one that acquired GSPC’s The KG-OSN-
in the Bay of Bengal. helps produce 80% interest in 2001/3 block,
ONGC on 12 June sought hydrocarbon 2017, the field which was
expression of interest from from below the awarded to GSPC
has produced
“global oil and gas companies ONGC wants a global partner earth’s surface or an its partners in
with requisite technical for the DDW field. REUTERS seabed. negligible the first bid
expertise and financial “However, four quantities of gas round of the New hindustantimes htTweets www.hindustantimes.com

strength to join as partner The block contains the wells which were Exploration
(with participative interest) for Deen Dayal West (DDW) gas/ completed did Licensing Policy
firming up a viable strategy” condensate field, which was not yield good productivity as brought by the then National
for the field, according to the discovered by GSPC almost anticipated and performance Democratic Alliance govern-
Canara HSBC Life Insurance Company Limited
tender document. two decades back. The Gujarat was suboptimal. Severe tech- ment under Prime Minister 139, Sector - 44, Gurugram-122003, Haryana (India)
The field has produced neg- government company had nical challenges and complica- Atal Bihari Vajpayee, com- Tel: 0124-4535500, Email: procurement@canarahsbclife.in
ligible quantities of gas since showcased the field as a prom- tions were encountered in the prises five fields—DDW, DDE, NOTICE INVITING BIDS/OFFERS
ONGC in January 2017 ising prospect when it sold its other three wells during drill- DDN, DD-DT and DD-BRU. Of Open Tender is invited against RFP for Empanelment of Vendors for IT Resources dated
24 June 2024.
acquired Gujarat State Petro- stake to ONGC in order to cut ing and completion phase and these, DDW, which lies about Above tender has been uploaded on https://www.canarahsbclife.com/tenders-notices.html,
leum Corp. Ltd’s (GSPC) 80%
interest in the KG-OSN-
2001/3 block off the east coast.
its debt.
The field, which was ini-
tially said to hold up to 20 tril-
had to be abandoned,” ONGC 10km off the Andhra Pradesh
said. coast, is spread over 37.5 sq.
The firm now wants a global km and is under development.
Connecting you to website of Canara HSBC Life Insurance Company Ltd. All prospective bidders are advised to
visit the aforesaid website for downloading the RFP.

Global Insights!
Gautam Adani drew ₹9.26 cr pay in FY24
PTI Adani, who is worth $106
feedback@livemint.com billion according to the
Discover comprehensive
NEW DELHI Bloomberg Billionaire Index,
has been jostling with Ambani

G by the Leaders in Journalism

autam Adani, India’s for the spot of the richest per-
second richest person, son in Asia. He became the
received a total remu- richest Asian in 2022 but lost
neration of ₹9.26 crore in the that position after a damning
fiscal year ended 31 March— report by US short seller Hin-
lower than most industry denburg Research wiped out
peers as well as his own key nearly $150 billion of market
executives. value of his group stock at its
Adani, 61, drew a salary from lowest point last year.
only two out of the 10 compa- He regained the top spot on
nies in his ports-to-energy two occasions this year but
conglomerate, annual reports Gautam Adani drew a salary from only two out of the 10 again ceded the position to
of the 10 listed entities of the companies in his ports-to-energy conglomerate. PTI Ambani.
group showed. Ambani is ranked 12th on
His remuneration for Adani also drew ₹6.8 crore prior to which he had capped the world’s richest list with a
2023-24 from flagship firm from Adani Ports and SEZ Ltd his remuneration at ₹15 net worth of $111 billion. Adani
Adani Enterprises Ltd (APSEZ). crore—Adani’s remuneration is ranked 14th.
included ₹2.19 crore salary and Adani’s salary is lower than is much lower than telecom Adani’s younger brother
perquisites, allowances and the heads of almost all large czar Sunil Bharti Mittal (₹16.7 Rajesh got ₹8.37 crore, includ-
other benefits worth ₹27 lakh. family-owned conglomerates crore in 2022-23), Rajiv Bajaj ing ₹4.71 crore commission on
The total remuneration of in India. (₹53.7 crore), Pawan Munjal profit from Adani Enterprises,
₹2.46 crore was 3% more than While the richest Indian, (₹80 crore), Larsen &Toubro while nephew Pranav drew
the previous financial year, Mukesh Ambani, has been chairman S.N. Subrahmanyan ₹6.46 crore, including ₹4.5
according to Adani Enter- foregoing his entire salary and Infosys chief executive crore commission, the annual
prises’ 2023-24 annual report. since covid-19 broke out— Salil S. Parekh. report showed.
08 MONDAY, 24 JUNE 2024
NEW DELHI GLOBAL LIVEMINT.COM

Nvidia is no Cisco but is now pricier

The rise of Chinese EVs Dan Gallagher
feedback@livemint.com

is dividing the West I

s a great business worth any
price? Nvidia investors
finally seem to be asking
themselves that question.
The chip maker powering the
artificial-intelligence revolu-
tion blew past $3 trillion in mar-
U.S., European tariffs on Chinese EV imports look similar but will have different consequences ket capitalization earlier this
month barely three months
after passing $2 trillion. It even
Stephen Wilmot became the world’s most valua-
feedback@livemint.com ble company earlier this week,
briefly surpassing Microsoft and

A
merica and Europe are Apple. That seems to have given
heading down different investors some pause; Nvidia’s
roads in response to share price has slipped nearly
China’s emergence as an 7% since trading resumed after
electric-vehicle jugger- the Juneteenth holiday. Nvidia blew past $3 tn market capitalization earlier this month. AFP
naut. Still, with a value of a little
The U.S. is closing its borders to Chi- over $3.1 trillion as of Friday’s peak in March 2000, according plans to spend even more in the
nese EVs before they even launch. The close, Nvidia is hardly cheap. to FactSet data. And that was on coming year.
Biden administration last month raised That is merely 2% below that of less impressive financial per- “Unlike the ‘dot-com boom’
the total tariff rate to 102.5% on Chinese Apple, a company with more formance, as the company’s that was funded by risky debt-
EVs, despite extremely low imports. than 2 times Nvidia’s trailing revenue grew 55% in the fiscal taking, genAI deployment is a
Canada, whose car industry is tightly 12-month free cash flow. The year that ended that July with mission-critical race between
integrated with the U.S., is considering stock is also now at nearly 45 an operating margin of 17%, some of the best-funded (cloud)
new tariffs too, Bloomberg reported on times projected earnings for down from 24% the year customers,” Vivek Arya of BofA
Friday. the next four quarters. That is before, according to data from Securities wrote in a note to cli-
In case sky-high import duties don’t 11% above its five-year average S&P Global Market Intelli- ents this week.
keep Chinese EVs away—for example if multiple and about 35% higher gence. Nvidia’s trailing Nvidia will also have more
they are built in Mexico to benefit from than what 1 2 - m o n t h software revenue coming into
the country’s free-trade agreement the stock revenue at its mix as the growing base of its
with the U.S. and Canada—Washington was fetch- the end of AI systems will necessitate
also launched an investigation in Feb- ing when the April more use of its software tools by
ruary to assess their security risks. This the company’s market value quarter was more than triple developers.
could be an even more potent blocking first crossed the $2 trillion that of the same period last That doesn’t necessarily
tool. If President Biden loses Novem- threshold in March. year, while its operating margin make Nvidia’s shares safe at
ber’s election, a second Trump admin- Nvidia’s sharp rise—and big has more than doubled in that their current level, though. The
istration would likely be even more gains made by stocks such as time to 60%. stock has seen a big influx of
hawkish. Dell, Super Micro and Broad- Cisco’s business also cra- individual investors since the
Meanwhile in the European Union, com that are also seen as AI ena- tered the following year as company’s latest financial
additional tariffs announced by Brus- blers—has spawned inevitable orders from financially shaky results last month. Daily retail
sels this month will only slow the influx Canada, whose car industry is tightly integrated with the US, is considering new tariffs too. BLOOMBERG comparisons to the dot-com customers that had been prop- inflow has averaged nearly $141
of Chinese EVs. The products need to bubble that burst nearly a quar- ping up its bookings quickly million since the earnings com-
overcome consumer resistance to tiatives invoke World Trade Organiza- try against excess Chinese capacity will automakers still access the Chinese ter of century ago. There are vanished. It actually lost money pared with a daily average of
unfamiliar brands, which will take tion rules that allow so-called “counter- simply create excess European capac- market. some parallels: The early days of in the 2001 fiscal about $39 million
time, but the market is open. vailing duties” on subsidized products. ity. This is good news for consumers, The U.S. is borrowing different tac- the Internet favored companies year after earning Nvidia’s sharp rise during the month
The proposed levels of duty are rela- The “Section 301” tariffs used by Wash- who will get deals and wheels, but bad tics from China. Tariff increases need selling the necessary hardware $3.2 billion the has sparked prior, according
tively modest: an additional 17.4% in ington, by contrast, are a uniquely for old-school car manufacturers in to be seen alongside the Biden admin- to get homes and businesses year before. “This comparisons to to Vanda
the all-important case of Chinese mar- American tool that is unlikely to lead to what was already a tough market. istration’s Inflation Reduction Act, online. Cisco, IBM, Lucent may be the fastest the dot-com Research.
ket leader BYD. On top of a longstand- any kind of bilateral deal. The incumbent industry could help which kicked off a new era of Chinese- Technologies and Intel were deceleration any Sell-side ana-
bubble that burst lysts are also get-
ing 10% tariff, that might close most of The key effect of EU tariffs would be itself by sharing plants style industrial policy four of the 10 most valuable company of our
the company’s cost advantage com- to speed up an existing trend toward with the newcomers. Stel- To deter backed by massive state companies on the market by the size has ever expe- nearly a quarter ting rather exu-
pared with European peers, but it prob- localizing production, as happened lantis, which owns brands Chinese EVs, spending. If the elaborate end of 1999, according to data rienced,” Cisco’s of century ago berant. Several
ably wouldn’t throw when the Reagan such as Fiat and Peugeot Washington has combination of carrots from S&P Global Market Intelli- then chief execu- have pushed up
its growth plans off administration as well as the Chrysler also launched a and sticks works, it will gence. Cisco overtook Microsoft tive, John Cham- their price targets
course. Assuming placed tariffs on business in Detroit, last create a whole new EV to become the most valuable bers, said in the company’s since the stock’s June 10 split.
security risk
that the company Japanese cars in the month formed a European supply chain to run along- public company about four earnings release in May of that And at least four of those tar-
splits the cost impact of the proposed 1980s. Andrew Bergbaum, a partner at joint venture with a Chi- investigation in side the Chinese one that months later. year. gets are now at $160 and
tariff with consumers, Citi estimated consulting firm AlixPartners, already nese automaker, Zhejiang February dominates today’s indus- Cisco’s stock price is about Such a drastic turn is highly higher, which would put
that it would still make higher margins counts eight planned Chinese EV fac- Leapmotor Technology. try. But this, too, is a recipe 40% below that level now, unlikely for Nvidia. Deep- Nvidia’s market capitalization
in Europe than in brutally competitive tories in Europe. As long as they also The business is starting to for overcapacity, particu- adjusted for splits. That seems pocketed tech giants such as near $4 trillion at its current
China. use a high enough proportion of local use a Stellantis factory in Poland to larly as it will be tough to keep the sup- like a cautionary tale for Nvidia’s Microsoft, Google and Amazon share count. Nvidia may be the
And the final tariffs could be lower parts, they will be able to sell into the manufacture Leapmotor vehicles for ply chains totally separate. Regardless shareholders. But there are also that operate extensive cloud top gun of AI, but investors
still. The EV probe is part of a negotia- region duty-free. the European market, according to a of its growth potential, the EV industry some important differences to computing networks account should be careful not to write
tion: China responded last week with There are no more car buyers for recent Jefferies note. In some ways, the is doomed to low returns by its political consider. Cisco swelled to a for more than 40% of the com- checks the stock can’t cash.
its own antidumping investigation into these new factories, so the tariffs being approach is a mirror image of the Chi- sensitivity. much frothier multiple of 131 pany’s data-center sales, and ©2024 DOW JONES & COM-
imports of EU pork products. Both ini- introduced to protect European indus- nese JVs through which most Western ©2024 DOW JONES & COMPANY, INC. times forward earnings at its they all have clearly signaled PANY, INC.

Global investors grow wary of Can AI startups outrun comparisons with the
once favourite Japanese stocks dot-com bubble? Investors aren’t so sure.
Bloomberg Belle Lin late 1990s got “messy” because unit, said some AI startups
feedback@livemint.com feedback@livemint.com every venture-capital firm have been outmaneuvered by
needed its bet in the space— the technology’s pace. Taking

J F
apan’s record share market ears of investing in the leading to inflation in the costs an input and giving it to an AI
rally earlier this year is look- artificial-intelligence of expenses such as hiring and model like OpenAI’s GPT-4
ing like a distant memory as startup boom—and feed- office space, according to Mike doesn’t offer much differentia-
foreign investors sell off ing a bubble like the one that Schroepfer, the former chief tion, he said in Toronto.
stocks in a sluggish economy. devastated firms in the dot- technology officer of Face- One solution, Wood said, is
Citigroup Inc. and abrdn Plc com era—have investors wary book parent Meta Platforms for startups to build “autono-
are among banks that have of writing checks with the fer- and a partner at Gigascale mous agents,” or virtual AI
turned more pessimistic vor of prior years. Capital. workers that can perform spe-
toward the nation’s equities as ChatGPT fever hit some- A similar dynamic is playing cific tasks on behalf of humans.
the outlook for corporate gov- thing of a peak last year, inves- out now with the AI boom, The technology is developing
ernance reform and the Bank of tors said this week at Collision, investors say. quickly, he said, and names of
Japan’s monetary policy a tech startup and investor Nowadays, scrutiny should AI agents may soon become as
remains uncertain. A fund conference in Toronto. The be applied to AI startups, valuable as web domain
manager survey by Bank of Japan’s blue-chip Nikkei 225 index has stalled since reaching an aftermath, and a sense of déjà where a rush to fund them has names.
America Corp. showed about a all-time high on 22 March. AP vu, are giving them a clearer created a lot of noise, Schroep- The cloud giant is putting
third of respondents believe sense of what’s investible. fer said in Toronto. Plus, train- $230 million into generative
the market has peaked. unloading a net ¥250 billion ment’s Aisa Ogoshi said. “Everybody thought dot- ing large language models at AI startups this year, Wood
Foreign investors, who ($1.6 billion) worth of Japanese Despite the recent sluggish- com was useful. ‘Oh I can go the scale of OpenAI requires added. “What we’re seeing is
helped push up Japanese stocks in the week ended 14 ness of shares though, several buy things online,’ and look millions of dollars for comput- the doubling down on what’s
shares to a record high just a June, according to TSE data. strategists including those at what happened,” Wesley ing and AI chips, so that’s not Of the 1,623 startups that exhibited at this year’s Collision tech working,” he said. “Now,
few months ago and beat over- Japanese equities are facing BlackRock Inc. and Morgan Chan, a co-founder and man- an area in which new startups conference, 20% are building AI products, organizers said. AFP there’s a few breakout areas
seas peers, became net sellers “a material risk of correction,” Stanley remain positive on aging partner at FPV Ventures, can be competitive. where we have high compe-
for a fourth straight week and it’s likely to take a while Japan’s long-term outlook, cit- said in “What $21.8 billion into generative AI News Corp has a content-li- tence, and they’re attracting
through 14 June. That was the before positive factors emerge, ing structural changes includ- Toronto. you’re left deals last year, up fivefold from censing partnership with more of the investment as an
longest streak since Septem- according to Citigroup analysts. ing corporate reforms, domes- “I’m the with is, ‘Is the prior year, according to OpenAI. overall percentage.”
ber, according to Tokyo Stock Investors are becoming wary tic investments and wage anti-AI there a research firm CB Insights. The Alex Mans, founder and Joseph Dormani, a partner
Exchange data. about the yen’s relentless slide. growth. guy,” he added, describing his market where I can get a very average round size for those chief executive of AI-powered at Thomson Reuters Ventures,
Japan’s blue-chip Nikkei 225 In the past they welcomed the Investors will be closely investment strategy. unique data moat, where I deals was $51 million, com- travel and transportation plat- said his team met with about
index has stalled since reaching weak currency as watching whether Of the 1,623 startups that have the data to train the pared with the industry aver- form Flyr, said he encountered 50 startups at Collision this
an all-time high on 22 March. a boon for export- Foreign the BOJ pushes exhibited at Collision this model?’” he said. “And when age of $8 million, CB Insights a large number of AI startups week. He said some of the most
It’s dropped 5.6% since then, ers, but the degree investors became ahead with its sec- year—the highest number of my customers use it, they give found. at Collision working on prod- interesting weren’t those with
compared with a 1% gain during of the yen’s recent net sellers of ond interest-rate any Collision event—20% are me new data, so I’m building Judging by the ucts that do the general AI capabilities, but
the period for the MSCI AC Asia drop has put the Japanese shares hike in July after building AI products, accord- my data flywheel.” type of startups The aftermath of same thing as those offering the ability to
Pacific Index, and a 4.4% focus on how it lifting rates for the ing to organizers. A spokesper- Since the start of the AI on display at Col- 2024’s ChatGPT existing AI mod- search across databases using
for a fourth
advance in the US’s surging may harm Japan’s first time since son said that doesn’t include a boom, investors have poured lision, some fever and a sense els. “There’s a lot AI, and that helped companies
S&P 500 Index. economy, includ- straight week 2007 in March. large proportion of startups record levels of funding into investors say the of companies that use multiple AI models.
through 14 June of déjà vu are
ing by boosting The Topix index that now have “AI compo- AI companies such as Mistral market has
“The early optimism for Jap-
giving investors a look like vertical It’s likely that the Thomson
anese stocks this year is clearly inflationary pres- for banks has nents” in their business. AI, which raised $650 mil- reached an inflec- software-as-a- Reuters venture arm will
hitting a speed bump,” said sure. climbed 30% this Only a small number of lion earlier this month at a tion point. With a clearer sense of service, but invest in some of them, he said.
Hebe Chen, an analyst at IG The yen depreciated on Fri- year, about double the gains of them will survive and break roughly $6 billion valuation. handful of com- what’s investible they’re just a Last year, it invested in a
Markets Ltd. “Investors face the day to approach 160 per dollar, the overall Topix gauge, on through the AI hype, investors Tech company Amazon panies such as pretty interface startup building AI summaries
soul-searching question of a level it hasn’t touched since expectations rising borrowing said this week. invested $2.75 billion in OpenAI and on top of a large for medical insurance claims.
whether the drivers for Japa- April, prompting Japanese cur- costs will help financial firms Some said they’re increas- Anthropic in March, bring- Anthropic dominating the language model,” he said. “When people say, ‘We’re
nese stocks are sustainable.” rency officials to warn against improve their lending margins. ingly looking for startups with ing its total investment in the building of large language Some offer products that help investing in AI,’ at this point
Factors that supported Japa- excessive foreign exchange But bets that the BOJ may go business models that have AI company to $4 billion. models, startups like Data- companies analyze their invoi- it’s almost like saying you
nese shares earlier are starting moves. slow in raising rates has long-term viability, products CoreWeave, an AI comput- bricks and Scale AI providing ces, but there’s no reason to invest in software. It doesn’t
to drag on the market. Foreign “We would like to see some weighed on lenders more that solve corporate business ing startup, raised $7.5 bil- data capabilities, and others in use them when an AI chatbot really mean too much,” Dor-
investors that flooded in, floor in terms of the weakening recently, with the bank index problems and those with lion in private-debt financ- image generation and cus- works just as well, Mans said. mani said. “The product is
attracted by Japan’s unprece- trend” of the yen, and that may dropping 5.2% this month access to stores of private or ing in May. tomer service, everyone else is That’s the same reason Matt what matters.”
dented push to improve share- benefit the domestic economy, compared with a 1.7% decline in unique data to train AI models. Those are just a few of the fighting to stand out. Wood, vice president of AI ©2024 DOW JONES & COM-
holder value, are now selling, JPMorgan Asset Manage- the Topix. The dot-com boom of the biggest checks—investors put Wall Street Journal owner products at Amazon’s cloud PANY, INC.
LIVEMINT.COM NEWS WRAP MONDAY, 24 JUNE 2024
NEW DELHI 09

NEWS
50
THE NUMBER of medicines, including
$3 bn
THE AMOUNT the Adani Group plans to
₹66.2 cr
THE BOX office collections recorded by
₹1 lakh
THE SUBSIDY by Tamil Nadu govt for
52%
THE PERCENTAGE of students who sat
IN Paracetamol and Cuftin cough syrup that invest in setting up its first pumped- Maharaja starring Vijay Sethupathi and 1,000 women and transgender individuals for the NEET-UG 2024 re-test out of a total
NUMBERS India’s drug regulator found to be of
sub-standard quality across India
storage hydropower facility, as it seeks
to strengthen its clean energy business
Anurag Kashyap in the nine days since its
release, including ₹18 crore overseas
to buy autorickshaws, enhancing their
earnings and promoting self-sufficiency
1,563 candidates who were awarded grace
marks in the previous exam held in May

HOWINDIALIVES.COM

GST Council plans THIRD TIME’S A CHARM Comm min working

to rejig 3 key GoMs on India, Korea FTA

T W
he GST Council will have to reconstitute ith talks to upgrade the existing free
three Group of Ministers (GoM) under it trade agreement (FTA) moving
as new ministers from 11 states joined the forward between India and Korea,
body on Saturday. the department of commerce is engaging with
Finance minister Nirmala Sitharaman has different ministries, including heavy
said that in the 53rd GST Council meeting on industries, steel, and chemicals, to prepare the
Saturday, there were 11 new ministers from offer list, an official said. Preparation of the list
Andhra Pradesh, Bihar, Chhattisgarh, is part of the negotiations, which are underway,
Haryana, Madhya Pradesh, Mizoram, Odisha, for the upgrade of the existing FTA between
Rajasthan, Sikkim, Telangana and Tripura. the two countries, dubbed as comprehensive
The 52nd GST Council meeting was held on economic partnership agreement (CEPA).
7 October 2023.With new ministers joining the The agreement was operationalised in
council, the reconstitution of three GoMs on January 2010. So far, 10 rounds of talks have
analysis of revenue from GST, boosting the real been concluded.
estate sector under GST, and GST system The official said both sides have exchanged
reforms are on the cards. the request list and “are working on the offer
While the GoM on GST rate rationalisation list” and for that the commerce ministry is
has already been reconstituted in February, holding discussions with different ministries,
making Bihar deputy chief minister Samrat including steel, heavy industries, textiles,
Chaudhary its convenor, the reconstitution of chemicals and petrochemicals. PTI
the other three is yet to be notified. PTI

ISRO on Sunday achieved a third consecutive success in the Reusable Launch Vehicle (RLV) landing experiment. RLV LEX-03 demonstrated the
autonomous landing capability of the winged vehicle, named Pushpak, under more challenging release conditions and boosts India’s confidence in
critical technologies essential for future orbital re-entry missions. PTI

The projects were hit by a cost overrun of more

FSSAI plans to issue licence in Proceeds will be used to increase the working
capital requirements of the company. ISTOCKPHOTO
than ₹5.71 trillion in May this year.

458 infra projects

MINT

24 hrs to traders, distributors Armee Infotech files

₹250 cr IPO papers
hit by cost overrun
I
T infrastructure solutions provider Armee

A
s many as 458 infrastructure projects, Infotech Ltd has filed preliminary papers
each entailing an investment of ₹150 FSSAI has included this proposal as part of the government's 100-day post-poll agenda with capital markets regulator Sebi to raise
crore or above, were hit by a cost ₹250 crore through an initial public offering
overrun of more than ₹5.71 trillion in May this (IPO).
year, according to an official report. Somrita Ghosh Under the proposed plan, FSSAI will set up a licence. The Gujarat-based company’s initial share
According to the ministry of statistics and somrita.ghosh@partner.livemint.com dedicated digital platform, allowing traders to Last year, a central advisory committee had rec- sale is completely a fresh issue of equity shares
programme implementation (MoSPI), which New Delhi upload relevant documents and receive licences ommended extending the validity of FSSAI licen- with no offer for sale component, according to
monitors infrastructure projects worth ₹150 within 24 hours, the official added. ces for food business operators from one year to up the draft red herring prospectus (DRHP) filed

T
crore and above, out of 1,817 projects, 458 he Food Safety and Standards Authority An email sent to the FSSAI chairperson to five years, eliminating the need for annual on Friday. Proceeds of the issue will be used to
reported cost overruns and 831 projects were of India (FSSAI) aims to expedite licenc- remained unanswered till press time. renewals. increase the working capital requirements of
delayed. ing for traders and distributors, and may FSSAI licenses, The initiative, a the company, payment of debt and general
The total original cost of implementation of soon start issuing licences within 24 which are manda- long-standing corporate purposes.
1,817 projects was ₹27,58,567.23 crore, and hours of application, to improve ease of tory for both export- FSSAI licenses are issued digitally demand of food Armee Infotech services a wide variety of
their anticipated completion cost is likely to be doing business. ing and importing with a QR code, which provides business operators, projects for both government/public sector
₹33,29,647.99 crore, which reflects an overall An official familiar with the matter, seeking ano- food products, are
cost overrun of over ₹5,71,080.76 (20.70% of nymity, said the FSSAI has included this proposal issued digitally with access to the details of the licensed was welcomed by
the industry for facil-
undertakings (PSUs) and private sector with a
focus on government/PSU projects. The range
original cost), the ministry’s latest report for as part of the government's 100-day agenda. Cur- a QR code, which or registered entities itating ease of doing of projects undertaken by the company
May 2024 showed. According to the report, the rently, acquiring a license takes one to two months. provides access to business. includes supply and installation of IT hardware
expenditure incurred on these projects till May "This initiative is not for manufacturers, but only the details of the Before the Lok and software, among others. PTI
2024 is ₹1,707,190.15 crore, which is 51.3% of for traders and distributors. As of now, the time licensed or registered entities stored in the FSSAI Sabha elections, the National Democratic Alliance
the anticipated cost of the projects. taken for acquiring license even for traders and dis- database. This helps in identifying any fraudulent (NDA) government had formed 10 sectoral groups
However, the number of delayed projects tributors is one to two months. FSSAI sensed that activity. of secretaries (SGoS) to finalize its post-poll 100-
decreased to 554, provided the delay is
calculated on the basis of the latest schedule of
they don't require so much of time to get a license
and it can be provided within a short span," the offi-
All food business operators, including pharma- day agenda. The move sought to identify 70 critical
cies selling health supplements or nutraceutical objectives that will be prioritized by the current
Kerala: Should get
completion, it added. PTI cial stated. products, must obtain FSSAI registration or a government, according to relevance and urgency.
60% share of GST

K
erala finance minister K. N. Balagopal has
Daikin to sell 2 mn Electronic components demand to rise
called for a review of the central-state tax
sharing ratio of the goods and services
units of AC in FY25 tax (GST), and said that 60% should go to the
states, whereas it is shared equally now.
Indian Industry (CII) report released on Currently, the ratio is 50:50 and it should be

A
ir conditioner maker Daikin expects to Sunday said. The report recommends the changed to 40:60 in favour of the states, the
manufacture two million units in India government to come up with revised minister said in the GST Council meeting held
this fiscal and has plans to scout for more electronic components production- in New Delhi on Saturday, according to a
export opportunities by making India a linked incentive schemes with higher statement issued by his office on Sunday.
manufacturing hub. incentives in the range of 35-40% to Speaking about the significant issues
The company has already sold 7 lakh units of reduce dependence on imports. addressed during the meeting, the state FM
residential air conditioner (RAC) in the first “The demand for components and sub- said a favourable decision taken with regard to
three months of the year, helped by a blistering assemblies stood at $45.5 billion to the integrated goods and services tax (IGST) is
summer this season and expects over 50% support $102 billion worth of electronics expected to be greatly beneficial for Kerala.
growth, said Daikin Airconditioning India production in 2023. This demand is Generally, a GSTR-8 return is also required
chairman and managing director Kanwaljeet expected to scale to $240 billion to Gujarat, Maharashtra, Goa, and Karnataka could to be filed detailing the GST charges by e-
Jawa. Daikin, which has started its third support the $500 billion worth see heavy to very heavy rains, IMD said. AP commerce operators while doing business
manufacturing unit in India at Sri City in Andhra The demand is estimated to grow over electronics production by 2030. Priority through e-commerce platforms, Balagopal
Pradesh, is investing in compressor
manufacturing here and aiming to manufacture
five-fold to $240 billion by 2030. BLOOMBERG components and sub-assemblies,
including PCBAs, are projected to grow at
IMD predicts heavy said. PTI

D rains for West Coast

five million units by 2030. “The mandate is of 5 emand for electronic components a robust CAGR of 30%, reaching $139
million units, which includes 4 million units for and sub-assemblies is estimated to billion by 2030,” the report said.
the domestic market and 1 million of exports by grow over five-fold to $240 billion The CII report has recommended that
SBI to open 400
H
2030 and we are very confident,” Jawa said. by 2030, including includes some of the the government craft a scheme aimed at eavy rains are expected to lash several
The company is anticipating a “robust
growth” in RAC volumes in the Indian market,
key parts like motherboard, lithium ion
batteries, camera module etc. that are
providing fiscal support for select
components and sub-assemblies in the
areas along India’s western coast over the
next five days as the monsoon advances, branches in FY25
which has a comparatively low penetration of largely imported, a Confederation of range of 6-8% for 6-8 years. PTI according to the weather office.

A
around 7%. PTI Gujarat, Maharashtra, Goa, and Karnataka s part of the network expansion plan,
could see heavy to very heavy rains, India State Bank of India (SBI) is planning to
Meteorological Department (IMD) said in a open 400 branches across the country
statement on Sunday. Other coastal provinces, in the current financial year.
Fed’s preferred inflation measures may offer path to rate cuts such as Tamil Nadu, Andhra Pradesh and
Odisha, as well as some land-locked states, are
The country’s biggest lender opened 137
branches last fiscal. Of the total, 59 new rural
also expected to see heavy downpour and gusty branches were launched.

T
he Federal Reserve’s favoured inflation yardsticks are poised to show winds. “Somebody asked me if 89% of digital and
the tamest monthly advances since late last year—a stepping stone for Monsoon runs from June to September and 98% transactions were happening outside the
officials to begin lowering interest rates, possibly as soon as September. is crucial for the country’s farm productivity as branch, whether the branch is required
Economists expect no change in the May personal consumption well as replenishing hydro-power reservoirs. anymore. My answer is yes. It is still required
expenditures price index and a minimal 0.1% gain in the core measure that This month’s rains started weak, which had because there are newer areas which are
excludes food and energy, based on median projections in a Bloomberg fuelled concerns about the outlook for key emerging,” SBI chairman Dinesh Kumar Khara
survey of economists. crops. said. There are certain services like most of the
The report, due Friday, is also projected to show 2.6% annual advances in While irrigating the farmlands, heavy rains advisory and wealth services that can be
both the overall and core gauges. The expected increase in the core measure, also cause devastating floods in various parts of offered only from the branch, he said.
which paints a better picture of underlying inflation, would remain the the country every year. India’s home minister “We will be identifying locations where the
smallest since March 2021. Amit Shah met with top officials to review opportunity exists, and in those locations, we
Since their last meeting, Fed officials have said that while they’re preparedness for flood management, news plan to open branches. Almost 400 branches
encouraged by the simmering down in other inflation data — including the agency ANI reported. we plan to add this year,” he said.
consumer price index—they need to see months of such progress before The report is projected to show 2.6% annual advances in both the Arunachal Pradesh is already flooded, the SBI has a network of 22,542 branches across
lowering rates. BLOOMBERG overall and core gauges. BLOOMBERG news agency reported. BLOOMBERG the country as of March 2024. PTI
10 MONDAY, 24 JUNE 2024
NEW DELHI LONG STORY LIVEMINT.COM

WHY MODI 3.0 NEEDS A

NEW ECONOMIC BLUEPRINT
Experts have called for the next generation of reforms, but coalition politics could limit such ambitions.

A file photo of daily wagers and labourers waiting for work at Bara Tooti Chowk in Sadar Bazar, New Delhi. Rapid formalization of the economy has reduced the quantum of informal jobs. HT

N. Madhavan ion that the NDA government’s economic (capex) post-covid. In 2018-19, the central that this is a problem. The only way to cor-
mint FAST LANE
madhavan.n@livemint.com management has delivered. Indeed, BJP government’s capex was just ₹3 trillion, or SHORT rect this situation is to strike a balance, say
CHENNAI leaders take pride in claiming that the 1.6% of GDP. As per the 2024-25 interim STORY India’s economy grew rapidly post-covid economists. “The informal sector should
growth in the last nine years has pulled budget, it will be ₹11.11 trillion, or 3.4% of GDP growth 9.7
also be supported in a big way. The gov-

S
athyanarayana Rao, 26, a native 248 million people out of multi-dimen- GDP. A revival in exports (merchandise (in %) 8.2 ernment has come up with Mudra Loans
of Guntur in Andhra Pradesh, sional poverty. By investing heavily in exports touched a new peak in FY23) and WHAT 7.0 6.5 and a few other schemes, but they have not
has been fascinated by large capital expenditure, economists say, the private consumption, though skewed, 3.9 been enough. Much more needs to be
machines since childhood. His government has laid the foundation for accelerated economic growth. Most experts are of the view that 2020-21 done,” said one economist.
family was poor but that did not sustained and fast-paced economic Modi 3.0’s immediate priority will be to Modi government’s economic 2019-20 2021-22 2022-23 2023-24 2024-25(E)

stop him from achieving his dream of growth. Spending on welfare schemes, sustain this pace of growth and that is not management has delivered. FISCAL CONSOLIDATION
Heavy capital expenditure, -5.8 E: estimate
becoming an engineer. Five years on, though significant, has been tightened
however, the biggest machine he has and delivery is better, while subsidies are
operated is the two-wheeler he rides as a better directed, they argue. Most of all,
going to be easy. “The 8.2% growth regis-
tered in 2023-24 is a flash in the pan and
cannot be maintained. An average 7%
they say, laid the foundation
for rapid economic growth.
Capex-led growth
India’s economic growth was largely
A nother facet of the NDA govern-
ment’s economic management is its
penchant for fiscal consolidation. Prior to
messenger for a chilli trader in Guntur. “I there is a belief that the formalization of GDP growth would be ideal,” says Ranga- powered by government spending the pandemic, the government had
am exhausted trying to get a job that suits the economy has gathered pace thanks to rajan. In 2024-25, it may slip further. Capex As a % of GDP brought the fiscal deficit down to 3.4% of
my education,” he says, wiping the sweat the Goods and Services Tax (GST) and that Madhavi Arora, lead economist at AND 12
(in  trillion) (right-hand scale)
4
GDP, the closest in years to the target of
off his brow on a hot summer afternoon in the philosophy of ‘less government, more Emkay Global Financial Services, esti- 3% set under the Fiscal Responsibility and
BJP leaders claim that the growth 9 3
May. Rao says the ₹10,000 he earns as an governance’ has begun to take root. The mates India’s economic growth will fall to Budget Management Act way back in
in the last decade has pulled 6 2
“errand boy” is just enough to keep his divestment of loss-making Air India is 6.5%. 2003. Covid put paid to any plans for a fur-
248 mn people out of poverty. 3 1
family going. Not surprisingly, the edu- cited as a case in point here. “Slowing manufacturing, a not-too-ex- ther reduction.
Delivery of welfare schemes has 0 0
cated, underemployed young man is frus- But the electoral outcome has raised citing consumption story, where private 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 The fiscal deficit ran up to 9.2% in
trated and angry. And he is not alone—a questions over the efficacy of this eco- consumption growth is the lowest in 20 improved, while subsidies are RE: revised estimate; BE: budget estimate (RE) (BE)
2022-21. The Modi government brought
multitude of disgruntled youth across the nomic approach. While the pundits were years excluding the pandemic years, a better directed, they claim. Tightening the belt it down to 5.8% in 2023-24 with a plan to
country find themselves in a similar pre- touting the country’s strong economic high base effect and cyclical headwinds Fiscal deficit has declined sharply post-covid reduce it to 5.1% by 2024-25. This has
dicament. growth and India becoming the fastest are the contributing factors,” she explains. Fiscal deficit (% of GDP) been possible partly due to revenue buoy-
Writing in Mint recently, Nitin Pai, growing large economy in the world, the The cyclical headwinds include slowing BUT 2018-19
2019-20
3.4
4.0
ancy and more importantly, due to aggres-
co-founder of public policy think tank electorate had little interest in macro- exports, tighter lending standards and sive reduction of unwanted revenue
The poll mandate has made it 2020-21 9.2
Takshashila Institution, said India needs level numbers. The message from the commodity prices no longer being low. expenditure and better targeting of wel-
clear that the government 2021-22 6.7
to create 20 million jobs a year to gainfully micro level—down on the ground—was 2022-23 6.4 fare schemes and subsidies. “Ten years
employ its people. It is clear: More than welfare, REFORM LIMITATIONS needs to tweak its policies 2023-24 (RE) 5.8 ago, the revenue expense as a proportion
and ensure that economic
not that the Indian
economy, which is
growing at a rapid pace,
The government should
focus on financial sector
people want jobs—good
jobs that pay more than
the minimum wage.
W hile economists have called for the
next generation of reforms to
accelerate economic growth, the compul-
growth is more equitable and
broad-based, say economists
2024-25 (BE) 5.1
RE: revised estimate; BE: budget estimate
Source: Emkay Global Financial Services, GoI data
of total expenditure was 89%. In 2024-25,
it will be just 77%,” says Emkay’s Arora.
Would the electoral outcome have per-
is not creating jobs; the Simply put, the man- sions of coalition politics could limit such SATISH KUMAR/MINT haps been different if the government had
unemployment rate for reforms, judiciary-related date has made it clear ambitions. “Big-factor market reforms eased up on fiscal consolidation and spent
people aged 15 years or changes and improve the that the government like land, labour, agriculture and capital the city. In the last five years, he has only served to exacerbate the situation. more on people struggling at the bottom
above dipped to 3.1% in needs to tweak its poli- could take a backseat. So will privatization changed jobs multiple times as the units “Between 2017-18 and 2022-23, the of the pyramid? Sixty-three-year-old M.
2023 from 4.2% in 2021, dispute settlement cies and ensure that and asset monetization,” says Arora. he worked in were forced to shut or down- footprint of the unorganized sector in the Ayyanar, from Andipatti, a town in South-
according to the Peri- India’s economic growth Instead of wasting its energy on big- size their operations. Sundaramurthy, in gross output of the economy fell by almost West Tamil Nadu, certainly thinks so. He
odic Labour Force Sur- mechanism, say economists. is more equitable and ticket reforms that are difficult to pull off other words, is a victim of the formaliza- two percentage points, from 34.9% to is trying hard to sell the cucumbers grown
vey’s data. But the econ- broad-based. And so, as in a coalition era, economists say Modi 3.0 tion of the economy. 33%,” points out Sinha. Some jobs may on his small farm outside the town’s bus
omy doesn’t seem to be creating enough Prime Minister Modi commences his should restrain its impulses and focus on “In India, the formal sector has never have disappeared. “The organized sector, stand. Ayyanar plies an autorickshaw, but
jobs in line with demand, according to record-equalling third term, sans an out- less contentious but more effective poli- created the jobs that the economy needs. to some extent, filled the vacuum left by the Tamil Nadu government’s decision to
some observers. right majority, the NDA government’s cies. Typically, it is the unorganized sector that the informal sector, but it never created offer free bus rides to women has hurt his
Did this issue cost the BJP its majority economic management needs to be modi- “There are a lot of reforms that can be did this,” says Sinha. In agriculture, 92% of that many jobs,” he says. In fact, he argues, business significantly. He barely makes
and force it to form a coalition govern- fied. executed to provide wings to the econ- the jobs are created in the unorganized the formal sector, which is driven by cost money to cover his fuel costs and is deep in
ment? It may well have. According to the omy. Coalition partners will have no sector. In industry and services, 73% of the competitiveness, can never create as debt, having borrowed money to fund his
World Inequality Lab, the gap between SUSTAINING GROWTH issues with them,” says Sunil Kumar jobs that are created are informal. The many jobs as the unorganized sector. Its daughter’s marriage and pay for the edu-
the haves and have-nots has widened dur-
ing the last decade, through the two terms W ithout growth, equity will be a dis-
tant dream. Without equity,
of the NDA government. The richest 1% of growth cannot be sustained,” says C. Ran-
Sinha, senior director and principal econ-
omist, India Ratings.
These include financial sector reforms,
government and private sector account
for only 27% of the jobs, notes Sinha.
The BJP government strongly believed
focus has been and will be to increase pro-
ductivity by reducing labour per output
unit.
cation of his son, who remains unem-
ployed. “I agree there are many welfare
schemes, and they help my family
the population now owns 40% of the garajan, former governor of the Reserve judiciary-related changes, improving the in organizing the informal sector and such While formalization of the informal immensely. But we are still struggling to
country’s wealth. Worse, the bottom 50% Bank of India and former chairman of the dispute settlement mechanism, which can a move, it felt, would go a long way in plug- sector is the way forward as it leads to bet- lead a decent life,” he says.
own just 6.4% of the wealth. Prime Minister’s Economic Advisory free up a lot of locked-up capital, and so ging the leaks in tax mobilization and con- ter quality jobs, where workers will get Sathyanarayana Rao, G. Sundaramur-
There are variations even among the Council. India, at the moment, has got the on, says Sinha. tribute to economic growth. Policymakers better pay and social security, a labour thy and M. Ayyanar are the faces of India’s
middle classes. It is unusual to see car first part right, say experts, noting that it is either did not factor in the impact of for- surplus market such as India should make rural distress. Modi 3.0 will have to keep
makers growing faster than two-wheeler growing at a pace that is the envy of other GROWTH WITH EQUITY malization on job creation or assumed the the transition (from unorganized to for- them front and centre in framing its eco-
makers in a developing country like India. large economies. In 2023-24, it clocked
But that is what happened in the years fol- GDP (gross domestic product) growth of
lowing the pandemic, epitomizing the 8.2% on top of the strong 7% growth in
G. Sundaramurthy, a 42-year-old
native of Pollachi in Tamil Nadu,
was happy working in one of the many
expanded formal economy would create
the necessary jobs. A series of measures by
the government, such as demonetization
mal) in a measured manner, especially at
a time when a large number of youth are
entering the workforce, say experts. Hav-
nomic policies. Fortunately, the govern-
ment has the fiscal headroom for spend-
ing more. The Reserve Bank of India has
skewed, K-shaped consumption in key 2022-23. small-scale industrial units in nearby and the introduction of GST, left the ing rushed through this process, India just given it a ₹2.1 trillion dividend
parts of the economy as inequality Data shows that India’s growth has been Coimbatore. Lack of formal education informal sector reeling, leaving small appears to be struggling. bonanza, equivalent to 0.4% of GDP. Will
exploded. powered predominantly by the govern- prevented him from getting a formal job in entrepreneurs and workers like Sundara- Government officials that Mint spoke to, the government go for it? Its first budget
However, many experts are of the opin- ment’s massive capital expenditure one of the large industrial units that dot murthy in the lurch. The covid pandemic who did not want to be identified, accepted next month will offer a clue.
LIVEMINT.COM MINT MONEY MONDAY, 24 JUNE 2024
NEW DELHI 11

Why Zerodha MF is positioning its POWER

POINT
liquid ETF as ideal tool for traders RAHUL GOEL

We welcome your views and comments at

mintmoney@livemint.com

MISSED A MARKET
The product allows investors to offset short-term capital losses against gains, reducing their overall tax liability
RALLY? LEARN FROM
Jash Kriplani
jash.kriplani@livemint.com
ever, investors can verify these units
in the holding statement of the
depository.
How Zerodha MF used traders' feedback for its liquid ETF WHAT BUFFETT DID

Z
erodha Asset Manage- Besides, fund houses provide a Zerodha Nifty 1D Rate Liquid ETF — industry's 1st growth NAV liquid ETF — has already crossed 1,000 crore AUM

S
ment Ltd (Zerodah MF), reinvestment statement and divi- o, you missed the bull market? How hard are you kicking
a subsidiary of India’s dend statement showing credited Fund name yourself for this so-called fault of yours? Well, if you stick
leading brokerage firm units over time, said a mutual fund Zerodha Nifty 1D with me till the end today, you will perhaps feel better about
Zerodha, has introduced executive. “This shows the units that Rate Liquid ETF yourself. And, maybe also figure out a way to get back in.
the mutual fund industry’s first liq- have got credited to the investor’s (Of course), let’s start with Warren Buffett. While we know him
uid exchange-traded fund (ETF) account over a period of time, AUM for being one of the most successful investors of all time, it is
with a growth-based net asset value, against the units purchased by the 1,366 crore important to know one other fact. Buffett also missed one of the
or NAV. investor,” said the product head of a biggest wealth creating megatrends, ever. I am referring to tech-
The product caters to traders fund house, seeking anonymity. Ideal for nology stocks.
Short-term
looking to park short-term funds Some dividend-based liquid ETFs traders; active
Buffett was famous for saying that he does not invest in compa-
and secure margins for future trades, do not reinvest dividends but pay the investors nies he cannot understand. That lack of understanding may have
as well as retail investors seeking dividend directly to the investor in cost him tens of billions of dollars, if not more. And yet, he
efficient cash management. cash. Total expense became rich. Really rich.
Unlike traditional dividend-based However, tracking returns is chal- ratio (TER) But here’s the thing, Buffett ultimately did get into technology,
liquid ETFs, which involve daily div- lenging as dividend-linked units are 0.26% in a massive way. And perhaps, on terms he approves of.
idend reinvestments and fractional paid out daily after TDS (tax Yes, I am referring to the massive investment Buffett made in
units, Zerodha’s growth NAV liquid deducted at source) deduction. Apple (a tech company) in 2016. Over time, he bet a huge chunk
ETF simplifies tracking by adding Investors need to monitor fractional Other large liquid ETFs AUM as on 21 June, 2024 (in  crore) TER (in %) of Berkshire’s cash on this one single stock.
the gains directly to the NAV, offer- units to determine their final tax lia- Nippon India ETF Nifty Now, why did Buffett buy the stock? Well, for starters, let’s get
ing a hassle-free alternative, besides bility. 1D Rate Liquid BeES
11,902 0.69 Where does it invest one fact out of the way. He did not understand technology even
simplifying tax implications. There is a tax event daily as divi- Overnight liquid
when he invested in it. But what changed? Buffett understood
However, before exploring how dends are generated daily. Divi- ICICI Prudential BSE that Apple’s consumers will keep buying products Apple created.
Liquid Rate ETF 3,212 0.25 instruments with 1 day
the Zerodha Nifty 1D Rate Liquid dends are paid after TDS of 10%, and maturity - TREPS* - And they were willing to pay a lot of money for the product out
ETF works, let's take a quick look at the dividends are taxed at the inves- DSP NIFTY 1D Rate which is backed by of their sense of loyalty.
dividend-based liquid ETFs. tor's slab rate. To be sure, some of the 1,044 0.34 government securities Let’s come to the second reason. Buffett bought Apple when
Liquid ETF^
Dividend-based liquid ETFs dividend-based liquid ETFs were ^DSP MF launched growth NAV liquid ETF in March, it was trading at about 10 times earnings. Unbelievable, right?
2024. Its TER is same as that of its previous liquid ETF
Liquid ETFs invest in TREPS with launched when dividends were tax- Today, Apple trades at a P/E of about 33x, based on past earnings.
a one-day maturity. free in the hands of the investor. At the risk of oversimplifying, Buffett bought into a high-qual-
TREPS, or Triparty Repo, is a Fractional units cannot be sold How is it different ity company for cheap. He once again waited for the right oppor-
short-term borrowing directly on stock Most liquid ETFs are dividend-based, tunity to make a big bet. And in case you are wondering, it’s esti-
and lending instrument, Traders can use exchanges, and one of How is it better Zerodha's fund offers growth-based NAV mated that in the last eight years, his
involving a triparty liquid ETFs as the options is to transfer BETTER trackability of All gains are added to fund's NAV and capital No FOMO. Keep investment is up 5x to 6x (estimates
agreement between the returns in growth NAV gains taxation is applicable
an efficient cash to the mutual fund’s building cash vary). Yes, wow!
borrower and lender, management tool demat account through CAPITAL gains tax will be
and a clearing corpora- an off-market transfer. applicable Dividend liquid ETFs reserve, identify oneSoofthe person we admire had missed
the biggest wealth-generating
to park funds in TAX event can be deferred  Daily tax event as dividend is generated and reinvested daily high quality
tion, which acts as an Growth NAV liquid opportunities of all times. Until he did
intermediary. TREPS broking accounts ETFs till fund is redeemed  Fractional units (for dividend reinvested) credited daily, but only 1 firms you would not. He figured out a way to get in. Now
are used by mutual and earn interest A growth NAV liquid SHORT-TERM capital loss whole unit can be sold on exchanges# like to own in this story, replace Buffett with your-
funds to invest in short- ETF, such as Zerodha’s can be used to offset capital self, and tech stocks, with Indian stock
 Fractional unit structure may be difficult to track for returns and
term government trea- new offering, has no gains market. And 2016 (when Buffett
taxation
sury bills (T-Bills). dividend or reinvestment option, CHECK iNAV** on Zerodha *TREPS stands for treasury bills repurchase bought into Apple) with 2024.
Liquid ETFs are typically traded eliminating fractional units. Gains MF's website before buying **iNAV stands for intraday or indicative net asset value of ETF, shows fair value of ETF
You see where I am going. The fact that the Indian stock mar-
or selling on exchange #Investors can sell fractional units via an off-market transfer in mutual fund's demat account
on the Clearing Corp. of India Ltd are added directly to the NAV. kets have run up does not mean you have missed the opportunity
Refer to story for details
(CCIL), offering high liquidity. “The feedback we got from inves- forever. It just means you have to wait a while longer to get in.
Investors and traders can use these tors suggested there is demand for Now, there are two ways to deal with this. What I see people
ETFs as an efficient cash manage- products that can ease the trackabil- around me doing is the easy solution: buy into high momentum
ment tool to maintain funds in their ity,” said Vishal Jain, chief executive
Why liquid ETFs make sense for traders Benefits stocks hoping the momentum continues. This will probably work
broking accounts while earning officer, Zerodha MF. “Hence, we Settled T+1  LIQUID ETFs could fetch 5.7-6% till it doesn’t (it almost never does). Others are more adventurous.
Settled T+1 annual returns, better than bank savings
interest. thought of a growth NAV liquid ETF, Sell stocks + Stock gets debited They jumped into options trading and the like. There’s enough
buy liquid ETF from demat account Units of account
For example, through this route, where nothing is going in and out of liquid ETF
history to show these things do not work out for most people.
a trader or investor can sell stocks the investor's account. The NAV  MONEY lying idle in broker's margin The Buffett solution is this: don’t regret that you missed a rally
get credited account won't fetch any returns
and buy liquid ETF units simultane- reflects day-to-day returns, which to demat i.e. no FOMO. Instead, keep building cash reserves. At the same
ously on the same day. On a T+1 can be tracked easily.” Use ETF units when Earn returns as  THE ETF units can also be used as time keep identifying high quality firms you would like to own,
account
buying stocks again per overnight rates collateral for margin trades
basis, stocks are debited from the "I was invested in one of the divi- and at what price (think Buffett’s Apple purchase at 10 p/e, and
demat account, and on T+1, liquid dend-based liquid ETFs through a aim for very attractive valuations, which leave headroom to make
PRANAY BHARDWAJ/MINT
ETF units are credited, allowing the small-case. Every week, I would get a lot of money over time). That’s it. The rest of it is a waiting game.
investor to start earning returns dividend units, but didn't know at only triggered upon redemption. In Liquid ETFs can offer better Zerodha’s growth NAV ETF has Now, the risk you run is that the stocks you like will never cor-
immediately. what rate dividends were getting contrast, dividend-based liquid returns than bank savings accounts, among the lowest total expense ratio rect. That’s possible. But then what are the chances? If you have
Dividend-based liquid ETFs issued. Also, I didn't know how to ETFs generate and reinvest divi- typically in the range of 5.75-6% per (TER) compared to its peers at kept track, you know that crashes, or sharp corrections, are quite
maintain a fixed NAV of ₹1,000, exit the fractional units. Now, the dends daily, resulting in a daily tax annum. They also provide a better 0.26%. common.
offering more predictability. small-case has shifted to Zerodha's event. alternative to idle funds in a broking However, considering that it is a If the Buffett approach is too much of a test of temperament for
Returns are generated as daily divi- ETF. Returns are easier to track as Investors can also offset short- account, and can be pledged for new fund with just a six-month track you, then, best to go with an extremely disciplined fund manage-
dends and reinvested into the ETF. we can simply monitor the move- term capital losses against gains, margin collateral while continuing record, investors may choose to wait ment team. If you select well, they will play the waiting game on
These reinvested units are credited ment in the ETF's NAV," said Sarang reducing their overall tax liability. to earn gains. for it to build a history before using it your behalf.
to the investor's demat account on a Pitale, 44, a Pune-based investor and Should you opt for it? Zerodha’s growth NAV ETF elimi- for cash management needs. Those Whether you do it on your own, or through a disciplined fund
weekly basis. IT professional. Liquid ETFs are suitable for trad- nates the need to track fractional who opt to invest immediately management team, you may yet tap into this bull market. And
These ETFs also have some dis- In terms of taxation, capital gains ers and active investors who want to units to determine returns and the should check the intraday NAV when you look back a few years from now, you will realise, that
advantages. For instance, until the tax applies at the investor's slab rate avoid the hassle of transferring tax impact. Investors should check (iNAV) on Zerodha MF’s website you did not miss all of it. Perhaps, you even made your fair share
dividend units accumulate to at for both growth NAV and dividend money between their bank accounts the total cost of buying an ETF, as before purchasing or selling the of the profit. Like Buffett did with tech stocks and Apple.
least one whole unit, they don’t NAV ETFs. However, capital gains and the broking accounts, and then most brokers don’t charge broker- units. iNAV is used to calculate the Rahul Goel is the former chief executive of Equitymaster. You can
reflect on broking platforms, How- offer more flexibility, as taxes are re-deploy it for investing or trading. age on liquid ETF transactions. fair value of an ETF. tweet him @rahulgoel477.

What a personal loan costs you Tax implications of sovereign gold bonds
P ersonal loans are a way to use tomorrow’s income today, and the process involved
is simple. But you must note that the interest rates are much higher than, say, for a
car loan. This is because personal loans are unsecured loans. This means that the loan
Mahesh Nayak
ISTOCKPHOTO
the indexation, or 10% plus
applicable surcharge and edu-
is not backed by any asset. The loan amount and interest rate depend on parameters I invested in sovereign gold cation cess without indexation,
such as your income, existing credit, repayment capacity, and others. As personal loans bonds (SGBs) in FY16 and whichever is more beneficial.
come with high interest rates, continuous default will put you on a downward spiral. received the maturity pro- If the bonds sold to another
Here are some of the lowest personal loan interest rates offered by various banks. ceeds in FY24. According to investor, are held for 12
the terms, the proceeds are months or less, short-term
Loan amount: ₹1 lakh; tenure: 5 years
exempt from long-term capital gains on the sale will be
capital gains tax if taxable at the rate applicable to
Interest EMI redeemed on maturity. My the investor.
Lender Processing fee
rate (%) (₹) question is: Am I required to The taxable gains have to be
Union Bank of India 9.30-13.40 2,090-2,296 Up to 0.50% (Min ₹500) + GST; Nil for women professionals declare my earnings from disclosed in the return of
these bonds in my ITR2 for income in Schedule CG, deal-
Bank of Maharashtra 10.00-12.80 2,125-2,265 1% + GST AY25? If so, where? I do not ing with capital gains.
Indian Bank 10.00-11.40 2,125-2,194 1% (Max ₹10,000); Nil for Govt/PSU Employees
find any provision in Sched- In addition to the increase in
ule Capital Gains in the the value of the bonds in line
Punjab & Sind Bank 10.75-13.50 2,162-2,301 0.50% to 1% + GST ITR2 return. with the price of gold, an inves-
—Praveen Godbole tor also receives interest on the
HDFC Bank 10.75-24.00 2,162-2,877 Up to ₹4,999
initial issue price of the bonds,
ICICI Bank 10.80-16.15 2,164-2,440 Up to 2% SGBs are government secu- twice a year.
rities issued by the Reserve ASK MINT tion. Furthermore, in case of
Bank of India 10.85-14.85 2,167-2,371 Min ₹1,000 and Max ₹10,000 Bank of India, and are denomi- m TA X AT I O N Note: not all capital gains redemption, interest is paid to
Indian Overseas Bank 10.85-13.00 2,167-2,275 0.40% to 0.75% nated in grams of gold. Capital from the transfer of the bonds is the investor along with the
gains arising on redemption of exempt from tax. These bonds maturity amount.
Karnataka Bank 10.93-13.43 2,171-2,297 0.25% (Min ₹250) the bonds on maturity would redemption on maturity and can also be traded on a recog- Interest on these bonds,
be considered as an exempt premature redemption. There- nised stock exchange. Capital including amounts received
Canara Bank 10.95-16.25 2,172-2,445 Applicable charges are 0.50%, (Min ₹1,000 + GST and Max ₹5,000 + GST)*
transfer under section 47(viic) fore, one may be able to take a gains arising on sale of the upon redemption, is taxable as
UCO Bank 10.95-13.95 2,172-2,324 1% (Min ₹750) of the Income Tax Act, 1961 and view that capital gains arising bonds to another investor 'Income from other sources.
hence, not liable to tax. on redemption of the bonds, would be taxable. You should disclose this inter-
Axis Bank 10.99-22.00 2,174-2,649 Up to 2% + GST While HUFs, trusts, univer- irrespective of whether on If the bonds are held for est in Schedule OS of your
IDFC First Bank 10.99-23.99 2,174-2,876 2% sities and charitable institu- maturity, or a premature more than 12 months, the income tax return.
tions are also eligible to invest redemption, would be exempt investor will be able to claim Mahesh Nayak is director at
IDBI Bank 11.00-15.50 2,174-2,405 1% (Min ₹2,500) + taxes in these bonds, exemption from tax. the benefit of indexation of the CNK & Associates LLP
Bank of Baroda 11.10-18.75 2,179-2,580 1% to 2% (Min ₹1,000 and Max ₹10,000) + GST** from capital gains can be You should disclose such cost of acquisition for comput-
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Data as on 19 June 2024, as per banks’ websites. The EMI range is indicative and calculated on the basis of interest rate range. In an actual situation, While the tenor of the bonds exempt income' in Schedule EI gains. finance query? Send in your
it may include other fees and charges. The interest rates are for salaried individuals and pensioners for unsecured personal loan. Actual applicable queries at
interest rate may vary based on the credit profile, loan amount, tenure, company you work for and as per bank’s discretion. *shall be collected till
is eight years, they can be of your income tax return. In Such long-term capital gains
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and get them answered by
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not distinguish between income, and provide a descrip- cation cess after considering
12 MONDAY, 24 JUNE 2024
NEW DELHI VIEWS LIVEMINT.COM

OUR VIEW GUEST VIEW

PTI

CEOs need to challenge hardset

mental models to drive growth
This is key to spotting and exploiting new business opportunities as market conditions get tougher

navigating an evolving economic best for them, thereby adding value to

climate, societal changes and an unpre- their everyday lives.
dictable future. It is about identifying a Similarly, Netflix is betting on video
seed of opportunity for transformation gaming and is ahead of rival streaming
and growth amid any crisis and creating services like HBO Max and Disney Plus
it themselves if it is not obvious. In prac- when it comes to subscriber retention.
tice, this can mean embracing innova- However, like Ikea, its goal is to create
tion to reimagine an organization for a an adjacency while leveraging its core
digital era, capturing cost and opera- product—video streaming. This ties in
NITIN RAKESH tional efficiencies and enriching the with founder Reed Hastings’ view that
is chief executive officer and managing end-user journey based on customer Netflix competes with anything cus-
director at Mphasis. demands. It involves flipping the ‘back- tomers do to relax, including “drinking
to-front’ model to become customer- a bottle of wine.” As video gaming grows
centric, rather than service or product- rapidly, Netflix aims to retain its vast

Contradictions rule but

focused, and leveraging data analytics, subscriber base by offering mobile
AI and machine learning to predict video games at no extra cost.

I
t is no secret that businesses thrive future customer needs. The McKinsey report further reveals
when engineered for growth. For This strengthens customer retention, that businesses expanding into adjacent
CEOs, the challenge is how to lead, trust and companies’ relevance in a industries are “20% more likely to

can also spur new ideas sustain, recalibrate and drive growth
not only when the times are good, but
also when the going is tough or when
core business expansion has stalled. By
competitive landscape (think, for
instance, how Big Tech has entered the
financial services market, compelling
traditional banks to adopt more innova-
achieve greater growth.” Implementing
change and spotting growth opportuni-
ties requires CEOs to innovate, secure
company-wide buy-in, devise a strategy
adopting a holistic growth mindset, tive strategies and undertake digital and and ensure successful execution.
CEOs can kick-start subtle but powerful service transformations to keep up). By Lead by example: Some key questions
Rightist political-economy ideas have got overturned globally. In India too. Yet, incongruities shifts in work culture and risk appetite adopting an attitude of continuous CEOs can ask themselves include: How
that permeate the entire organization to innovation, CEOs can position their can the core competency solve global
also offer hope. Will India’s budget go beyond the synthetic constraints of a fiscal deficit? enable sustainable and scalable growth. organizations for strategic industry business problems? Which supply
The past few years have brought co-creation, allowing flexibility to spot chain parts need improvement? What
several critical challenges, including the gaps and capitalize on profitable cross- are customers looking for, and what can
unprecedented covid pandemic and selling opportunities. be done differently to help solve their

P
hilosopher George Santayana said where rightist political parties have grown pop- subsequent focus on economic recov- Build adjacencies for growth: A key most pressing problems? In essence,
the world is in “perpetual caricature” ular despite the country’s large social expendi- ery. More recently, the UK has faced a principle of a growth mindset is to seek businesses should aim to make them-
cost-of-living crisis, rising interest rates ways to expand into breakthrough areas selves indispensable to customers, a
of itself because, every moment, it is ture. Many Indian ideologues and planners who and an uncertain economic outlook. and adjacencies to stay ahead of the win-win scenario because this can build
presented with a contradiction of have been weaned on free-market thinking and While it has so far avoided a recession, curve. According to McKinsey, compa- new revenue streams.
what it is pretending to be. This insist that governments should remain small, macroeconomic uncertainties persist, nies and their CEOs who successfully Amazon exemplifies this approach.
holds especially true even for the have looked on in bewilderment as the US leaving business leaders cautious. adopt growth mindsets are 2.4 times CEO Jeff Bezos applied tools—from
knowledge universe, where an eternal cycle of government has intervened in its economy The lessons that have emerged have more likely to outperform their peers. inventory management to algorithm-
been invaluable. These challenges Further, those that invest in ‘growth based recommendation engines—that
conflicts and contradictions ensures that the through measures like industrial policy. Global have highlighted weaknesses in old pathways’ into adjacencies by building made it the world’s digital bookstore as
graveyard of old ideas is always full, leaving studies have shown that many economies approaches and business models. It on the core and innovating into ‘break- it moved adjacently towards electronics
behind a vacuum for new ideas to take birth. across the globe are doing much the same to would pay to explore how to accelerate out’ businesses are 97% more likely to and toys and everything sold online.
This never-ending sequence becomes the assist domestic industry. It highlights how eco- long-overdue changes in more difficult gain a competitive edge. For example, Amazon then disrupted more markets,
source, the wellspring, for renewal and endless nomic exigencies are forcing the acceptance of times like these. Mental models, repre- Swedish furniture giant Ikea expanded from healthcare to payments, including
senting how people view and interpret into new areas by empowering custom- launching a buy-now-pay-later product
optimism. As German playwright Bertolt contradictions till new solutions emerge. the world, can limit progress unless ers with integrated solutions, rather with Barclays and a home insurance
Brecht put it, “In the contradiction lies the Many of these contradictions exist in India as actively challenged. That is the secret than reinventing itself to enter another comparison service in the UK.
hope.” But the path between the two is never well. The ruling Bharatiya Janata Party (BJP), sauce to driving growth regardless of business domain like the television As businesses look ahead and compe-
easy because overcoming initial contradictions despite its rhetoric of economic restraint aimed the macroeconomic landscape. market. It focuses on equipping cus- tition heats up, CEOs must lay the
and reaching an eventual resolution requires at middle-class voters, has in fact been pushing CEOs must reshape their old mental tomers with all the necessary items for ground for resilient growth with smart,
models to build agility and resilience for their living rooms in a way that works sustainable and future-proof strategies.
the humility to accept incongruities, the hard on the pedal of social-sector spending,
courage to surmount the immediate challenge including the delivery of free rations of food-
and to find solutions that bring forth new ideas grain and cash transfers, apart from other bene-
which can stand on the shoulders of older ones. fits. Incongruities hit a high during this sum-
Corporate strategists, bean-counters and mer’s general elections: the opposition was able
quant-heavy economists may be tempted to to stitch together a cohesive coalition and win
discard this as an abstract notion, but the world 234 seats despite ground-level differences and www.livemint.com
New Delhi, Mumbai, Bangalore, Kolkata, Chennai, Ahmedabad, Hyderabad, Chandigarh*, Pune* Tuesday, June 24, 2014 Vol.8 No.149 `4.00 in Delhi-NCR/`5.00 outside Delhi-NCR 24 PAGES

today is wracked by contrasting challenges— pollsters discounting them. The government INTERNATIONAL: Kerry backs Iraq
against ‘existential’ threat >24
AVIATION: Air India to join Star Alliance on
11 July >3

extreme heat waves in some parts with flooding should look closely at this world of rising con- CONTENT PARTNER
CORPORATE: M.D. Mallya may join IndiGo
board amid IPO talk >8
VIEWS: Making a ‘supply side’ revolution >23

in others—and crying out for change. India tradictions to recognize a need for some new SENSEX 25,031.32 æ 74.19

ECONOMIC AGENDA
NIFTY 7,493.35 æ 18.10 DOLLAR `60.21 Æ `0.02

MONSOON DEFICIT
EURO `81.79 Æ `0.02 GOLD `28,225 æ `60

Canada pension QUICK EDIT

OIL $115.66 Æ $0.85

Budget to be fund to invest A good

too needs to acknowledge economic inconsist- ideas. The Union budget, to be presented in `2,000 crore in N-citizen
As the monsoon advanced through India in the week ended
23 June, rainfall was 37% less than usual for this time of the
year. While Karnataka, Tamil Nadu, Kerala, Rayalaseema, Bihar
L&T subsidiary
presented
and West Bengal saw normal rainfall, it was scanty in the rest
of the country. This week, heavy showers are expected in the hen India and the
W

Growth is never by mere

northeast even as the weak monsoon travels through B Y P .R . S ANJAI US signed a
Maharashtra and Uttar Pradesh. pr.sanjai@livemint.com landmark civil nuclear
························· cooperation agreement in
MUMBAI
2005, peaceniks and

encies and find long-term solutions. July, offers the first opening of this exercise. on 10 July T he Canada Pension Plan naysayers said India had
Percentage deviation of rainfall from its Investment Board (CPPIB), been made a nuclear
cumulative total (1 June-23 June 2014) for each which manages C$219 billion weapons state.
meteorological subdivision in the country.
of assets, has agreed to invest Those fears have been
-46 `2,000 crore in L&T Infrastruc- laid to rest with India
Jammu and ACTUAL
Kashmir ture Development Projects Ltd, confirming that it is
Budget session from necessary to improve govern- -28
Himachal
MONSOON
(till 23 June)
an unlisted subsidiary of In- opening its civilian

chance; it is the result of

7 July to 14 August ment finances and boost eco-
nomic growth. -26
-58
Pradesh -25
Assam and Arunachal Pradesh
-43 dia’s largest engineering and
construction company Larsen
nuclear facilities to
oversight by the

In the old economic orthodoxy, ideologies Budget-making mustn’t be held hostage by

-51
will be amid concerns “It’s necessary to take steps to
Haryana, Chandigarh,
Delhi
Punjab
Uttarakhand 8
Sub-Himalayan
Meghalaya
and Toubro Ltd (L&T). International Atomic
of below-average improve financial discipline and -57
West
West Bengal The investment, to be made Energy Agency. On
improve the economic health of -67 in two instalments, will be rout- Monday, India said it is
monsoon rainfall the country,” Modi said on 14
-56
Saurashtra, West -50
Uttar
Pradesh
-33
East ed through CPP Investment signing an additional
Kutch, Diu Rajasthan East Uttar -17
June in a speech in Goa. “I know Rajasthan Pradesh Bihar Board Singaporean Holding 1 protocol with the global
B Y A SIT R ANJAN M ISHRA & my popularity might go down -84 -58
-6
-23
(CPPIBSH), a subsidiary of CP- agency that provides for
Gujarat East -17 -58
R EMYA N AIR due to these hard decisions, region, Daman
West Madhya Jharkhand
Gangetic Nagaland, PIB. inspections of these
························· Madhya Pradesh
people might be annoyed with and DNH* Pradesh West Bengal Mizoram, The investment board will facilities.
NEW DELHI -41 Manipur,

were dichotomous and did not bleed into each anodyne forces keen only on balancing the
me, but they will appreciate it -48 -62
Chhattisgarh Odisha Tripura buy preference shares of L&T India, compared with

T
Vidarbha

forces working together.

he Narendra Modi-led later.” Infrastructure, compulsorily its roguish nuclear
-73
National Democratic Alli- In a sign of the tough meas- -56 Marathwada Bay of Bengal convertible into equity shares neighbour, has an
Central -43
ance (NDA) government ures it may be contemplating in Maharashtra Telangana
by 2018 at a mutually agreed impeccable record in
will present its first budget on 10 the budget, the government on -43 -39 price. After the conversion, CP- maintaining high
Konkan region, Goa North interior
July, setting out its economic Friday raised railway passenger Karnataka PIBSH will hold a minority standards of nuclear non-
-22 0 -71
agenda for the next five years fares by 14.3% and freight rates Coastal Karnataka Rayalaseema Coastal stake in L&T Infrastructure. proliferation. If any
and articulating how it will by 6.5% effective 25 June. 1 Andhra After the initial investment of signal was needed about
South Pradesh Rainfall index
steady and lift faltering eco- The budget will be presented Arabian Sea interior `1,000 crore, the second instal- its commitment to the
Karnataka -14 Normal
5

other. Right-wing politics, free-market evan- books, without making a meaningful economic
nomic growth, check persistent amid concerns of below-aver- Tamil Nadu,
19% to -19%
Andaman
ment—of a similar amount or global nuclear order,
inflation and achieve fiscal con- age monsoon rainfall that may Puducherry Deficient and Nicobar more—will follow after 12 surely this is it.
-26 -12 -20 or less Islands
solidation. take its toll on farm production Lakshadweep Kerala
months, as per mutual agree- India needs to mount a
The budget session of Parlia- and spur inflation. Wholesale ment and subject to regulatory diplomatic offensive to
ment will be held from 7 July to price inflation accelerated to approvals. join the nuclear suppliers
14 August. The railway budget 6.01% in May, the quickest pace *DNH: Dadra and Nagar Havelli
The deal comes at a time group. It has a lot to offer
will be presented on 8 July and since December; consumer when India’s new government the world in maintaining
the annual Economic price inflation slowed to peace and order.
Survey on 9 July before 8.28% in May from Source: India Meteorological Department TURN TO PAGE 2®
2014

gelism and distrust of the welfare state all impact. This may be an opportunity to look
AHMED RAZA KHAN/MINT
the budget is unveiled, 8.59% in April, but it’s
the cabinet committee still far above the cen-
on parliamentary affairs tral bank’s comfort
decided on Monday.
Finance minister
zone.
The ongoing turmoil GE clears last FEEDER SEPARATION

French hurdle NDA may unveil 24x7 electricity

JA ME S CASH P E N N E Y
Arun Jaitley has out- in Iraq, meanwhile, has
lined his broad objec- REB OTING led to a 5% increase in
tives, saying in a Face-
book post early this INDIA oil prices and any sharp
spike could roil the fis-
to Alstom deal
plan based on Gujarat scheme
tended to cohabit under the same tent. These beyond the synthetic constraints of a fiscal defi-
month that the nation cal calculations of the fi-
must move towards an era of nance minister by substantially
discipline to reduce the fiscal raising the fuel subsidy. Jaitley B Y I NTI L ANDAURO &
shortfall, contain inflation and has already spoken about pay- S TACY M EICHTRY PRIYANKA PARASHAR/MINT
improve economic growth that ing the “unpaid bills” of the pre- The Wall Street Journal B Y U TPAL B HASKAR
has slumped below 5% for two vious government, referring to ························· utpal.b@livemint.com
years in a row. the subsidy bills rolled over PARIS ·························
“We must commit ourselves from last year.
to this discipline...in order to The Union government’s fis- T he French government
struck a deal to purchase a
NEW DELHI

P rime Minister Narendra

rigidities no longer hold true. For example, Italy cit, or arbitrary limits on the debt-to-GDP ratio.
strengthen the Indian economy cal deficit stood at 4.47% of stake in Alstom SA from its Modi’s National Democrat-
which can improve the quality gross domestic product (GDP) leading shareholder, economy ic Alliance (NDA) government
of life of every Indian and pull in 2013-14 and former finance minister Arnaud Montebourg is likely to spell out a plan to
out the deprived ones from the minister P. Chidambaram said, clearing the way for Gen- supply electricity through sepa-
state of poverty,” Jaitley wrote. budgeted for a fiscal gap of 4.1% eral Electric Co. (GE) to com- rate feeders for agricultural and
“Short-term disciplining till we of GDP in his interim budget in plete its acquisition of most of rural household consumption
reverse the present trend will February. the French industrial firm. in the national budget it will un-
give us long-term benefits.” Moody’s Investors Service, The accord—hashed out in veil in July, aimed at eventually
Both Modi and Jaitley have which has assigned India the marathon talks between the providing round-the-clock

under Giorgia Meloni ranks among Europe’s These are important parameters, sure,
warned that tough measures are lowest investment grade rating government and French con- power.
with a stable outlook, said last glomerate Bouygues SA—grants The plan, based on the Jyoti- Stabilizing supply: The initiative also envisages complete metering and
week that it will not base its sov- the government an option to gram Yojana in Modi’s home strengthening of the electricity distribution system.
ereign credit outlook for India buy as much as 20% of Alstom state of Gujarat, may be made
on whether the NDA govern- from Bouygues at a future date, applicable across states to en- dancies in the system. The de- Also, availability of electricity
ment keeps its fiscal deficit tar- Montebourg said on Sunday. sure around eight hours of tails are being worked out,” the ensures billing and reduction of
get for 2014-15 below or above Bouygues, whose businesses quality power to agricultural official said. technical and commercial loss-
that set by the previous govern- range from construction to tele- consumers and 24-hour elec- The finance ministry’s posi- es due to theft and transmis-
ment, but on measures outlined communications, said the gov- tricity to households. tion on the scheme could not be sion. Billing losses are estimat-

highest social spenders even though the party but the current mix of contradictions demands
in next month’s full budget ernment’s option to buy Alstom In addition, the initiative, ascertained. Ministry officials ed at around 27% of the elec-
to address a lower revenue shares will last for 20 months billed as “Power to all 24x7”, have been quarantined for the tricity generated in the country.
base, high current expenditure and begin after the GE-Alstom also envisages complete meter- duration of the last phase of India’s minister in charge of
and exposure to global com- deal closes. ing and strengthening of the preparations for the NDA gov- power, coal, and new and re-
Under the agreement reached electricity distribution system. ernment’s first budget, which newable energy, Piyush Goyal,
TURN TO BACK PAGE ® Sunday, the government can “A plan is in the works. The will be announced by finance
buy shares held by Bouygues at states will have to satisfy certain minister Arun Jaitley on 10 July. TURN TO PAGE 2®
ALSO SEE a discount to their market rate, eligibility conditions,” said a The scheme works like this: a
with a minimum price of €35 senior government official on separation of feeders ensures
ALSO SEE

in power, Brothers of Italy, is known as a right- an innovative budget with a sharp focus on
>Union budget should spur revival in ($47.60), adjusted for special condition of anonymity. that while the agriculture sector
demand for metals >P14
>Cement and budget: hopes pinned on dividends or other events that “The scheme modelled on gets the desired amount of elec- >India debates creation of power sector
infrastructure, housing revival >P14 might influence the price in the the lines of one in Gujarat could tricity; the quality of power and fund to bail out projects >P3
Mint is also available for R8 with >Keeping excise duty unchanged will cheer be announced in the Union its availability for households >Govt seeks to scrap solar dumping duty
Hindustan Times in Delhi-NCR only auto stocks >P14 TURN TO PAGE 2® budget. It will reduce redun- improves. plan >P3

wing—if populist—party. Or look at France, employment creation and income generation.

MY VIEW | MODERN TIMES

Why the super-rich and we pay the same for house help
too, make poor people work for more than 12 The Hindujas also pointed out that their I really did think in my 20s that was how plying labour cheaper than in much of the
MANU JOSEPH hours on less than $8 a day. In their defence, domestic staff’s compensation was not just the world worked. world. Also, every strata of Indian society
they would say that the cost of living in India the cash they received, but also accommoda- The rich are willing to talk about how subsidizes the lifestyle of the strata above by
is a few times lower than in Europe, so what tion and food. That is exactly what my rela- much they spend on cars and carpets and working for exploitatively low wages. And in
household staff members are paid in India is tives, too, would say. ‘Accommodation’ in an homes. Wouldn’t it be just as interesting to the end, we have a situation where Indian
not as bad as it sounds. Indian household is usually a room that know how much the super-rich spend on billionaires probably pay only as much as I

S
ome things that my relatives do every A prosecutor said that the family had appears to be purposely impoverished. In their servants? do for domestic work.
day are crimes in Europe. I was spent almost $10,000 a year on their dog, my colony, for instance, For some reason, you No household can be impressive when it
reminded of it when news broke that while paying low wages to their human staff. the default ‘servant quar- can get to know a lot of comes to the matter of paying its domestic
four members of the billionaire Hinduja fam- This could be true even in a typical upper ters’ is a windowless room Even humane obscure things that the rich staff. Historically, all the famously humane
ily were held guilty by a Swiss court of treat- middle-class Indian household. They may fit for suitcases. spend on, but never what writers who moved our souls through prose
ing their house staff badly, though the family want to point out, though they would never As a boy growing up in writers who they spend on their staff. had servants who were probably not paid
rejected the charges and have reportedly do so in public, that do-gooders have a bad Madras, the most fascinat- That is because most rich more than market rates. Merchants and
appealed against the ruling. Like many habit of comparing how much a family ing thing I heard about the
moved our souls people pay only as much as conscience-keepers paid their servants just

is a journalist, novelist, and the

wealthy people of Indian origin, and some
diplomats, they had got house-help from
spends on their dog with how much they pay
their domestic workers. The comparison is
world outside was that in
the US, garbage cleaners
had servants what the middle class pays
their household staff. My
about the same. Even if some people pay a
bit more, it cannot be an impressive sum
creator of the Netflix series,
‘Decoupled’
India on pay scales that are generous by
Indian standards but illegal in Europe. The
absurd. A dog brings a lot of joy to the family,
and is even seen as a part of the family, unlike
would come in cars to
clean the streets. That
who were not colony probably has the per
capita income of Switzer-
when spoken out aloud, especially if com-
pared with the incomes of famous humani-
prosecution said the Hindujas paid the staff an employee. remains, till date, the most paid more than land, but it pays domestic tarians.
about $8 a day and that their work-days could The family did not deny the low pay, but impressive thing I have workers half of Europe’s What are the consequence of the Hinduja
be as long as 18 hours. The prosecution also said that the long hours’ part was an exag- ever heard about wealth. I market rates minimum wage. I am not family case? The wages of migrants won’t
alleged that family had “confiscated” their geration. They asked, as my neighbours eventually realized that the lamenting this. After all, I rise; instead, wealthy Indian families living
passports, which is a dramatic way of describ- would, that if a house-help watches a film at information, in word and too pay my cleaner ₹5,000 abroad may stop taking domestic workers
ing what I gather is a common practice. The home with the children, is that work? spirit, was a bit of an exaggeration. But the a month for getting into acrobatic positions from India, fearing trouble, ending a way of
accusations are a few years old. They Maybe it depends on the film in question. idea stuck that the best measure of a nation’s to clean for an hour every day, and a cook enriching poor Indian families. And
returned to the news after a financial settle- Also instructive would be whether the fam- wealth is the standard of living of its poor. only around the same for working 90 min- wealthy Indian families in the West would
ment was reached with the staff members but ily’s law firm would bill the two hours (or Ideally, there should be a similar measure of utes daily on meals. have to hire local help, which must be a bit
the prosecution pressed criminal charges. more) its lawyers would take if they watched an individual’s wealth. The rich keep talking about how they sub- uncomfortable because those workers have
It is likely that the Indian upper class sees the same film to ascertain whether the view- “How rich is that guy?” sidize the poor. They do. But it is also a fact such swag and that always diminishes the
all this as excessive because many of them, ing was entertainment or work. “Oh, he pays his driver a lakh.” that the poor subsidize our lifestyles by sup- experience of being a master.
LIVEMINT.COM VIEWS MONDAY, 24 JUNE 2024
NEW DELHI 13

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

Cooperative federalism can plug Shorts as office-wear? It is no

longer as unthinkable as it was
India’s climate adaptation deficit The norms of attire need to keep evolving but there’s resistance too

We need a comprehensive plan backed by resources at all levels and the 16th Finance Commission should make this a priority

ISTOCKPHOTO

SARAH GREEN CARMICHAEL

is a Bloomberg Opinion columnist and
editor.

NANDKUMAR SARAVADE &

SRINATH SRIDHARAN
are, respectively, former IPS officer and co-
founder of DeepStrat, and policy researcher
and corporate advisor.

A
s summer heats up, vitriolic debates
in the US are peaking. I’m talking
about the rift between men who

I
ndia has seen several transformative innova- wear shorts to office and those who con- The US tech sector has made suits and ties
tions in recent years. The development of sider these a workwear abomination. On seem fuddy-duddy ISTOCKPHOTO
Digital Public Infrastructure (DPI), particu- the West Coast, especially in the tech sec-
larly the Unified Payments Interface (UPI) and tor, wearing shorts to work is perhaps Yet, for men, at home or not, some ver-
Direct Benefit Transfer (DBT) mechanism, has unremarkable. But not in northeast US. sion of the dark suit has dominated for cen-
made lives easier and worked in favour of the “It’s a bizarre taboo for me,” says Derek turies. Barry points to 18th-century-born
cause of financial inclusion. Similarly, the Public Guy, a menswear writer. “It’s normal to dandy Beau Brummell as the one who
Distribution System (PDS) has ensured food secu- wear shorts, and whether you can wear made it fashionable. And professional
rity for the underprivileged and proved its mettle them to the office depends on the office.” It clothes seem more resistant to change than
during the recent pandemic. These achievements may be a complete non-issue for, say, casual attire. Even if a London barrister
underscore India’s ability to solve complex prob- graphic designers. But banks and law firms prefers baggy sweatpants on weekends,
lems through the implementation of ingenuity. are another matter. Yet, buttoned-up East she’ll still argue her cases in a white wig.
However, if one were to look at our looming Coasters are wondering if they can ditch But the meaning of clothes does evolve.
challenges, the scariest appears to be that not the long trousers. They often point to A century or so ago, a three-piece suit was
enough is being done to deal with climate change. global warming—last month was the hot- called a lounge suit and seen as far less for-
Such inertia, which seems most evident in climate test May on record. And women have long mal—a kind of 19th-century athleisure.
adaptation, poses a severe risk to India’s future, had the option of wearing floaty dresses to Think of those grainy photos of men
threatening to undermine all other progress. work. Why can’t men show a little leg, too? mountaineering in wool trousers, com-
With a vast and diverse geography, the impacts But then, whether Bermuda or cargo or plete with jacket and waistcoat. And if the
of climate change manifest in various devastating athletic, pleated or denim or chino, shorts Patagonia vest was once a symbol of an out-
forms: erratic monsoons, extreme heatwaves, aren’t just shorts, it would seem. Offices are doorsy lifestyle, it’s now become some-
rising sea levels and increasing frequency of natu- rife with power dynamics and pecking thing else entirely: a way for desk-bound
ral disasters like floods and cyclones. Not only do orders, an ecosystem worthy of David men to signal their aspiration to spend time
heat waves last longer and touch higher peaks, we becoming the new pandemics, leaving large num- monitoring systems to ensure compliance. As the Attenborough narration. in nature, or just a way to display their
also face the rising risk of wildfires in forest areas. bers dead in their wake. Rainfall will become even climate crisis and increasing urbanization start to Which forms of dress are acceptable membership in a particularly preppy tribe.
Beyond economic concerns, climate change signi- more inconsistent both temporally and spatially, produce more episodes of extreme heat, we must “comes down to norms, and belief systems So, what about shorts? Showing skin
fies an existential crisis for India, which is home to necessitating aggressive water conservation meas- invest in long-term programmes for reforestation about professionalism and how that inter- used to be a no-no for men in offices. But as
a sixth of humanity. The majority of our population ures, the creation of strategic water reservoirs, and urban green cover enhancement. sects with gender, race,and body type and dress becomes more casual (a trend that’s
is vulnerable to climate change-induced disasters. inter-basin water transfers and groundwater Climate action, including energy transition with other structures of power,” says Ben accelerated with the adoption of remote
Additionally, India still largely relies on agriculture replenishment through effective policies. Climate efforts, can only succeed if they are tied with devel- Barry, dean at the school of Fashion at Par- work) and mainstream men’s fashion
for employment and food security; this is a sector change-resistant crops need to be developed for opment promises and communicated in a way that sons, The New School. There’s class too. increasingly borrows from queer culture,
that critically depends on favourable climatic con- every region’s climatic conditions, with no further resonates with the country’s masses. Currently, Shorts may be more closely associated with says Barry, showing some leg is no longer
ditions to thrive. time to lose on long lab-to-farm cycles. there appears to be a disconnect on this front: those doing low-paid physical labour. seen as the same challenge to professional-
Despite foreknowledge, India’s climate adapta- All of this will require developing a national politically, India’s core development agenda aims Of course, the world of tech and startups ism or masculinity. “I don’t think it’s a big
tion efforts seem largely reactive. While there have awareness and action plan, involving experts, and primarily at the poor, while the country’s climate invented its own rules. There, the power deal to see a man’s knees,” says Guy.
been initiatives such as the National Action Plan on incentivizing the private sector to create frugal and agenda seems directed at global event platforms move is to dress like you don’t care. But Many younger workers agree with them.
Climate Change (NAPCC) and its associated mis- local solutions. and domestic elites. For India to see the impact of that too sends a signal. “It wasn’t just that Older workers may push back on new fash-
sions, their implementation has mostly been slow, Domestically, India does not have formal climate climate action, more businesses must be asked to people were dressing down,” says Guy, “It ions not for any practical reason, but
fragmented and underfunded. The focus of the legislation at either the federal or state level. To effect changes across their entire value chains. was a symbol that you only cared about because they feel threatened. Changing
NAPCC is more preventive than adaptive. Mean- a large extent, the problem lies in our missing Is there political hesitancy at both the federal meritocracy and that you did not care office fashions are a very visible signal that
while, the Prime Minister’s Council on Climate institutional design. While the central government and state levels to integrate substantive climate about the old ways… the only things that a new generation is gaining ground.
Change (PMCCC) meets infrequently and seems drives most of the initiatives along with its financial action into public agendas? Is there a fear that it mattered were your skills and your ideas.” Back in 1971, Harvard Business Review
understaffed. Local and state-level adaptation powers, sub-national units lack the capacity and could alienate powerful industrial constituencies Think of Mark Zuckerberg’s hoodies or surveyed readers on how they’d respond to
plans frequently lack the necessary coordination fiscal resources to take action, despite being tasked and disrupt the politico-industrial status quo? Sam Bankman-Fried’s shorts-with-tube- a “capable young manager in a financial
and resources to be effective, leaving communities with implementing India’s international pledges. It’s a given that cooperative federalism is essential socks combo. services company” who suddenly sports
vulnerable to the escalating impacts of global Most state-level initiatives to implement India’s for the decarbonization of industrial assets as well as Although it’s often said that women have “long sideburns” and “bell-bottom trous-
warming. global commitments, such as the big one on net- for the adaptation efforts needed to mitigate climate more freedom of dress, Guy and Barry ers.” Half said this hippie attire warranted
Beyond quality-of-life issues, when people are zero carbon emissions by 2070, are driven under change. Therefore, climate adaptation needs to be think that’s been overstated. Women’s skin a managerial sit-down, and another third
unable to deal with extreme heat, economic pro- the State Action Plan on Climate Change. Most of taken up as an agenda priority by the 16th Finance tends to be sexualized in a way men’s isn’t; said if his clothes irritated people, he
ductivity and livelihoods suffer. A large proportion these state action plans have lacked committed Commission that was recently set up. It would dem- a woman showing “too much thigh” in an should “change his ways or begin hunting
of Indian workers have to work outdoors. Their leadership and made little or no progress in the onstrate a national commitment to the cause. office is likely to be judged in moralistic for another job.” That leaves fewer than
safety, productivity and daily income are at stake. absence of resources. The sooner governments at every level accept terms. A woman might be able to get away one in five who said his groovy threads
So far, there seems little-to-nil action on a cohesive While more states are starting to adopt Heat that development and other fulfillers of people’s with ‘formal shorts’ (something of an oxy- were purely his own business.
climate-action framework for how we can cope Action Plans (HAPs), there are concerns over the aspirations have to be designed in the context of moron) more readily than the average man, Today’s office may no longer be quite as
with extreme heat waves, and almost no compre- extent to which these are being implemented. For climate realities, the smoother our path will be. but a woman who eschews style to SBF- conformist as it was, but the front-line of
hensive data on illnesses caused by extreme instance, only two of 37 HAPs currently in place in Indian climate adaptation efforts need to show how esque levels runs greater professional risk. fashion is always advancing. Who would
weather patterns. India conduct vulnerability assessments to identify innovation can assure survival and ingenuity can And keep in mind that women didn’t have have guessed back in 1971, for example, that
It is clear that the world, and India in particular, and support affected communities. Further, HAPs outshine denial. Let us treat climate action as a ‘office clothes’ until relatively recently, as half a century later we’d be dealing with
is going to get hotter, with heat waves potentially include the need to develop and institutionalize national security issue. women worked mostly at home. naked dressing? ©BLOOMBERG

THEIR VIEW

Ethanol: An eco-friendly fuel or another green mirage?

There are six main issues with mandating threatens water security and jeopardizes recent push for enhanced ethanol produc- biofuel crops like sugarcane, corn or soy-
ADITYA SINHA ethanol as fuel. food security. We thus face a dire trade-off tion threatens to undermine this progress. beans, it directly reduces the area available
First, the life-cycle energy demand for between energy and basic human needs. Ethanol production is inherently problem- for cultivating food crops. This competition
ethanol production from sugarcane stands The high WF contrasts with countries like atic, as it can lure farmers back into cultivat- for land use can lead to decreased food crop
at 4.99 megajoules per litre. Although etha- Brazil, where sugarcane cultivation is prima- ing water-intensive crops, creating a para- production. According to the International
nol’s energy return on investment (EROI or rily rain-fed, resulting in a lower WF. In dox that could undo our efforts to diversify Food Policy Research Institute, the expan-

I
n the early 20th century, Thomas Midgley the ratio of energy obtain to what’s spent on India, where freshwater resources are and conserve water. sion of biofuel production has led to signifi-
Jr, a chemist, introduced tetraethyl lead to obtaining it) is 4.26, it pales in comparison already scarce, using such Fifth, intensive sugar- cant land use changes, often at the expense
gasoline, promising to revolutionize the with other biofuels. Its modest EROI indi- a colossal volume of water cane farming, character- of food crops, resulting in reduced food sup-
automobile industry by reducing engine cates that ethanol production is not as ener- for ethanol production is Its promise as ized by monoculture prac- plies and increased prices.
knock. It seemed like a miracle solution at gy-efficient as it might seem. Studies have unsustainable and borders tices, frequent tilling and With less land dedicated to food crops, the
the time, and Midgley was hailed as a hero. shown that sugarcane cultivation’s energy- on the reckless. a clean fuel may the heavy use of chemical overall supply of food grains and other
However, the dark side of this innovation intensive nature, coupled with ethanol’s Fourth, India’s agricul- fertilizers and pesticides, essential crops decreases. As a result, the
soon became apparent as leaded gasoline processing needs, significantly undermines tural policy has long been
be outweighed significantly degrades soil supply-demand gap widens, leading to

is an officer on special duty,

caused widespread environmental damage
and severe public health issues, including
its net energy balance.
Second, according to a study published in
dominated by rice and
wheat because of the need
by its hidden health and agricultural
productivity over time.
higher food prices. The World Bank
reported in 2010 that food prices are seen to
Research at EAC-PM. brain damage in children. This tragic epi-
sode reminds us that what initially appears
Elsevier’s Bioresource Technology journal,
ethanol’s carbon footprint (CF) at 0.295kg
to procure these two crops
for the public distribution
threats to food Monoculture reduces bio-
diversity, which is essential
spike during rapid biofuel expansion, mak-
ing it harder for low-income households to
to be a groundbreaking solution can have CO2 equivalent per litre is lower than that of system. However, the security and the for maintaining soil struc- afford basic necessities. This price volatility
unforeseen and devastating consequences. fossil fuels, but it may be misleading to call it Department of Agriculture ture, while frequent tilling is compounded by the fact that biofuel crop
In our quest for cleaner energy, we have eco-friendly. The production process and Farmers Welfare is environment unsettles the soil, making it prices are influenced by both food markets
turned to ethanol, championing it as a green involves significant emissions and its trans- now championing a crop prone to erosion. The and energy markets, making them more sus-
alternative to fossil fuels. On the surface, it portation and processing stages add to this diversification programme heavy irrigation required ceptible to fluctuations in oil prices and pol-
seems like a perfect solution—renewable, carbon load. under the RKVY-Raftaar scheme in Hary- for sugarcane leads to waterlogging and soil icy changes in the energy sector.
ostensibly cleaner and easily integrated into Third, the most alarming, is the water ana, Punjab and western Uttar Pradesh. This compaction, further exacerbating erosion. Thus, we must exercise caution before
our existing fuel infrastructure. But as we footprint (WF) of ethanol: 1,344 litres per initiative aims to shift crops from water-in- Sixth, diverting agricultural land for bio- pressing the acceleration pedal on ethanol.
delve deeper, we must ask ourselves if etha- litre of ethanol produced. India’s heavy use tensive paddy to sustainable alternatives like fuel production poses significant risks to Ethanol’s promise as a green fuel might
nol is truly the environmental saviour it’s of groundwater for sugarcane irrigation pulses, oilseeds, coarse cereals, nutri-cereals food security. Farm-land diversion can push mask dire consequences. Let’s not repeat
touted to be, or are we being misled by yet worsens the blue water footprint, posing a and cotton, addressing the country’s press- up food prices by constraining supply. When history’s mistakes.
another green mirage? major opportunity cost. This misallocation ing need for water conservation. Yet, the agricultural land is repurposed for growing These are the author’s personal views.
और सभी न्यूज़ पेपर मैगजीन प्राप्त करने के लिए सर्वप्रथम इस टेलीग्राम ग्रुप को ज्वाइन करें नीचे दिए लिंक पर क्लिक करके ज्वाइन टेलीग्राम

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