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India’s curbs on import of pulses: US, Australia, EU raise concerns at WTO A commerce ministry official says India defended the restrictions on import of pulses as they are compliant with WTO rules Members of the World Trade Organization (WTO) including the US, Canada, Australia, European Union and Japan have raised concern over India’s quantitative restrictions on import of pulses.India capped imports of green gram (moong) and black matpe (urad) at 300,000 tonnes and that of pigeon peas (arhar) at 200,000 tonnes in August in the wake of domestic harvest and concerns over the slump in prices of traditional pulses. The issue came up in a 20 April meeting of the committee on import licensing at the WTO with countries alleging that quantitative restrictions by India on import of pulses distort global prices and put the future of farmers across many countries in peril. India has been the largest producer, as well as traditionally the largest importer of pulses to ensure steady supply...

RBI widens FPIs’ investment scope in local corporate debt Mint Street late on Tuesday raised the incentive for Corporate India to tap the bond market for its working capital needs, allowing foreign portfolio investors (FPIs) to invest a fifth of their total corpus in less th an one-year residual debt papers sold by local companies. The latest directive extends last week’s concessions that effectively enhanced shortterm GSec ownership by overseas funds. Although the policy maker has not raised benchmark rates yet in Asia’s third-biggest economy, the cost of funds at the short end of the yield curve has accelerated much faster than the long end, threatening to increase working capital expenses in an economy where the weighted average cost of capital trends higher than developed countries. “In order to bring consistency across debt categories, it is stipulated that investments by an FPI in corporate bonds with residual maturity below one year shall not exceed, at any point in time...

After NRI investments in domestic market, foreign funds on Sebi radar Regulator asks custodians to provide end-beneficiary data of foreign funds with Indian ownership A fortnight after the market regulator tightened rules around non-resident Indian (NRI) investments in the domestic market, several foreign funds have come under the scrutiny of the Securities and Exchange Board of India (Sebi) According to sources, the regulator has sought investment and end-beneficiary-related information of foreign portfolio investors (FPIs) from their custodians. Sebi wants to crack down on those NRI-managed funds that are also used to channel money belonging to persons of Indian origin (PIO) Sebi’s FPI regulations prohibit any foreign fund from being controlled by a PIO or NRI. Such entities are allowed to obtain an FPI licence on condition that they act only as investment advisors and do not invest their money. However, global funds typically ask fund managers to put up some seed capital...

 MFIs see slowdown in bank funding despite a fall in the cost of funds The average cost of funds for MFIs is 12-15 per cent, depending on their size Despite a fall in the cost of funds over the past year, banks remain shy of lending to microfinance institutions (MFIs), especially mid-size and small-size ones. In general, about 60 per cent of funding for MFIs come from banks. The rest was met through instruments such as securitisation (the marke t for which had dried after demonetisation) and debentures, among others. However, most banks have now restricted their funding to large MFIs, said entities in the segment. “In the past year, the cost of funds for MFIs has gone down by 60-70 basis points. However, banks have remained cautious in lending, due to their own problems. As a result, a lot of MFIs are looking at options like non-convertible debentures, which is long-term lending; the amount is also bigger,” said Rakesh Dubey, president, Micro Finance Institutions Network. ...

SEBI bans 28 entities for fraudulent trade with fake SMSes Markets regulator Sebi has barred 28 entities from the capital markets for sending out unauthenticated SMSes in bulk with misleading 'buy' recommendations to pump up trading volumes in the shares of Kalpa Commercial. The order comes after Sebi received complaints from intermediaries alleging that some unknown entities are sending guaranteed return SMSes, thereby misguiding the investors with unauthenticated SMSes. Following this, Sebi conducted a preliminary probe into the share trading of Kalpa Commercial Ltd (KCL) during October 10-18, 2017, specifically in relation to bulk Short Message Services (SMSes) circulated with questionable recommendations with respect to trading in the firm's shares. The probe found that 28 'connected entities' (group) had employed a scheme for offloading a large number of shares of KCL in a manipulative manner. They participated in the larger scheme of sending misleadi...

 GST revenue target set at Rs12 trillion for FY19 Economic recovery, anti-tax evasion measures seen boosting tax revenue The GST Council has set Rs12 trillion as the target for goods and services tax collections for the current financial year, buoyed by rising tax compliance in the first year of the new indirect tax regime. The federal indirect tax body noted that the average monthly receipts in the last fiscal year, despite several disruptions, were Rs89,885 crore, marginally below the Rs91,000 crore target. “GST receipts in FY18 have not been bad. The revised monthly revenue target for FY19 takes into account a 14% increase in states’ revenue growth estimate for compensation,” said a finance ministry official, requesting anonymity. Policymakers’ confidence in generating higher revenue from GST stems from the anti-tax evasion measures being put in place and the ongoing economic recovery. The positive impact of the e-way bill, which tracks goods movement electronically an...

Early Q4 results indicate earnings picking up pace Review shows profit growth quickened to 6-quarter high of 12.13% in March quarter Earnings growth of Indian companies has picked up pace in the three months ended 31 March after demonetization of high-value banknotes in 2016 and implementation of the goods and services tax (GST) in the following year disrupted business activity for several quarters. An initial review of earnings reported so far indicates profit growth has accelerated. Profit growth after adjustment for one-time items of 100 BSE-listed firms that have reported earnings quickened to a six-quarter high of 12.13% in the March quarter from a year earlier. That was faster than the 9.32% pace in the three months ended 31 December.  The government’s stress on affordable housing and higher minimum support price (MSP) for farm produce ahead of several state and national elections over the next 12 months are expected to support consumption demand, analysts said. A n...

EPFO to send you SMS update if employer fails to deposit contribution Currently, EPFO only sends messages to employees whose contributions are credited into their EPF accounts The next time your employer fails to deposit your contribution to the Employees’ Provident Fund Organisation (EPFO), you would get to know. EPFO will now inform employees whose contributions have not been deposited by the employer for a given month in due time. Currently, EPFO only sends messages to employees whose contributions are credited into their EPF accounts. “EPFO has so far been intimating its members by way of SMS on credit of their respective monthly contribution into their accounts,” said an EPFO press statement What is EPF? Every month, a salaried individual contributes 12% of her salary to the EPF account and the employer matches the contribution. The contributions then compound at a rate declared every year. “Employers have to credit the contributions with the EPF account by the 15th of ...

 India-US steel feud escalates as WTO sets up key panel The compliance panel was set up on Friday after a meeting of the dispute settlement body, despite the US opposing the move The ongoing trade spat between India and the US has intensified after the World Trade Organization (WTO) set up a compliance panel following India’s request on the non-implementation of the appellate body’s ruling against countervailing duties (CVD) imposed by the US on Indian hot-rolled carbon steel products. Confirming the move, a commerce ministry official speaking under condition of anonymity said the compliance panel was set up on Friday after a meeting of the dispute settlement body, despite the US opposing the move. The case pertains to India filing a WTO complaint in 2012 against the US CVD on India’s exports of hot-rolled carbon steel flat products. The dispute settlement panel gave a mixed verdict in July, 2014 which was further challenged by both countries before an appellate panel, the ...

  Govt seeks proposals for debt exchange traded fund by May 16 ETF structure to be decided by advisor in conjunction with government The government plans to launch its first debt exchange traded fund (ETF) early in the second half of 2018-19. The ETF’s basket is expected to contain debt offerings from 12-15 state-owned companies, including banks and central public sector enterprises (CPSE), Business Standard has learnt. The Centre will also discuss how to attract more retail investors into corporate bond markets, with market regulator Securities and Exchange Board of India (Sebi), starting with the planned debt ETF. Bonds of NTPC, Power Finance Corporation, Rural Electrification Corporation, LIC Housing Finance, Indian Railway Finance Corporation, National Highways Authority of India and others could be included in the basket. These would be fresh issuances. All these public sector undertakings (PSUs) are active in the corporate bond markets. “The ETF will comprise PSUs, ...

One year after coming into force, Rera remains a work in progress According to property consultancy firm Knight Frank, only 19 states and UTs have a functional portal in place, that too with a lot of information dissymmetry across data points A year after coming into force, what the Real Estate (Regulation and Development) Act, 2016, or Rera, has achieved is that it has made buyers more aware and developers cautious.  The implementation of Rera, however, remains an issue, as majorities of the states are yet to implement it fully. Only three states — Maharashtra, Madhya Pradesh, and Punjab — have implemented full-time regulators under Rera, while 26 states are yet to appoint full-time regulators. A full-time regulator would have implemented the norms in an effective manner. According to property consultancy firm Knight Frank, only 19 states and Union Territories (UTs) have a functional portal in place, that too with a lot of information dissymmetry across data points. In And...