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SEBI READIES P-NOTE FRAMEWORK FOR GIFT CITY Market regulator plans to relax norms for onshore securities Market regulator Sebi is readying a framework for issuance of participatory notes (p-notes) from international financial services centres such as GIFT City. It is in talks with FPIs, which act as issuers of p-notes, sources said. The move comes at a time when Indian bourses have terminated licensing of indices and data-feed agreements with their foreign counterparts. This will force overseas investors to either invest directly or come through GIFT City to trade in Indian securities. PAVAN BURUGULA writes The Securities and Exchange Board of India (Sebi) is readying a framework for issuance of participatory notes (p-notes) from the international financial services centres (IFSCs) such as GIFT City. P-notes are derivative instruments that allow overseas investors to invest in a domestic security without having to directly register with Sebi. The market regulator is in talks wi

GSTN to ensure stakeholder familiarity before reintroducing e-way bill GST Network Chairman Ajay Bhushan Pandey has said the company will try to ensure that stakeholders become fully familiar with the technology system before the re-rollout of the e-way bill system. Under the Goods and Services and Tax, which was rolled out from July 1 last year, transporters of goods worth more than Rs 50,000 are required to carry electronic or e-way bill. The e-way bill system was launched by GSTN on February 1 after conducting pilot for over a fortnight, but faced technical glitches following which its implementation had to be postponed. In an interview to PTI, Pandey said GSTN is conducting extended pilot for the e-way bill mechanism and has suggested to states that they should ask their transporters to undertake trial run for e-way bill generation on the portal. "As soon as there is a readiness of the system and stakeholders, we will roll it out. We are trying to do it as early as pos

RBI norms add to NCLT burden The National Company Law Tribunal, already burdened with about 2,000 bankruptcy cases pending, may see a flurry of fresh cases that may affect time-bound resolution after the banking regulator revamped the way loan defaults are to be handled, lawyers and bankers said. Right now, only some of the large cases are being tried, but there are several cases in the SME (small and medium enterprise) and mid-cap space where we have done restructuring and it has failed. If we send so many of these cases to NCLT, I don’t know how the logistics will work,” said a banker. The RBI on Monday scrapped all debt restructuring schemes and made resolution of bad loans time bound with the Insolvency & Bankruptcy Code becoming the main tool to deal with defaulters. RBI said accounts with aggregate debt of more than Rs 2,000 crore will have to be taken to NCLT within 15 days if a resolution plan does not bear fruit in 180 days. “NCLT is already under stress because

India market is recovering after GST, says PepsiCo CEO Indra Nooyi Pepsico's business in India registered a "mid-single digit (volume) growth" during the quarter, she said Chairwoman and chief executive officer (CEO) of PepsiCo, Indra Nooyi, on Tuesday said the consumer market in India was on a recovery path after initial disruptions caused due to the implementation of the goods and services tax (GST). In the past few weeks, top executives from major fast-moving consumer goods (FMCG) firms, including Unilever, Mondelez, and Colgate-Palmolive, were pinning their hopes on recovering from the initial GST hiccups in the country. “After GST, the India market is coming back”, Nooyi said. “We want to do better top line growth; there are headwinds like retail disruption. Consumers are health conscious, not consuming as much they used to. There are big brands that are not doing well, (on the other hand,) some smaller brands are doing good business,” Nooyi said during an

PROMOTERS GETA SETTLEMENT PUSH New rule may add to provisioning burden but aid in loan recovery Promoters of any large account in which the banking sector had an exposure of Rs 20 billion and above were in for trouble if they did not settle their dues soon, said experts. The impact on banks in terms of bad debt numbers and provisioning will remain elevated. estructuring, should be put through a resolution plan if the accounts were in default. If an account is in default with one bank, other lenders in the consortium will have to try and make the account good. Otherwise, the account could be classified as a stressed asset later, experts said, requiring high provisioning. But more clarification on this would be required, they said. Bankers said considering most accounts under restructuring have defaulted in the past, the new framework would force these accounts to the resolution path. However, the loans would have to re-rated again. This could be bad for the promoters because

Lead by PSBs, NPAs soar 34.5% in Q3; pain to linger on, claims report Public sector banks had a weaker performance on various indicators, including the key parameter of NPAs and also profitability, according to the agency The issue of impaired assets may be far from over for the banking system as gross non- performing assets have grown by 34.5 per cent in the December quarter, says a report. Even as bankers guide towards a better position with regard to bad loans, rating agency Care has said the issue of impaired assets is not yet over, including on recognition and accretion of loans into the dud assets category. In the report based on the performances of 30 lenders, including 17 private sector banks and 13 state-run ones, the agency said the quantum of gross NPAs moved up to 9.45 per cent as of December from 8.34 per cent a year ago. While private sector banks' bad loans ratio was maintained broadly at 4.1 per cent, their state-run counterparts registered a spike in the pr

IT Raid Cases Not to be Processed Under E-assessment: CBDT The soon-to-be rolled out pan India e-assessment system for scrutiny cases of taxpayers will not be applicable to instances where a raid has been conducted against an assessee by the Income Tax (IT) department, the CBDT has said. It has added that the current system of manual assessment will continue in cases, where the books of accounts or original documents have to be examined, the taxman has to conduct a third-party investigation and where the tax officer has to examine a witness It will also be applicable to cases where the taxman has issued a show-cause notice to the assessee, "contemplating any adverse view", and cases where the taxpayer has requested for a "personal hearing" to explain the matter to the assessing officer The Central Board of Direct Taxes (CBDT), the policy-making body of the IT department, issued an instruction on Monday to further explain how the system would work, once ful