CORPORATE UPDATES 23.04.2019

GUIDANCE NOTE ON RELATED PARTY TRANSACTIONS

As you are aware that the Institute of Company Secretaries of India (ICSI) has been the frontrunner to promote good Corporate Governance which is reflected in varied initiative taken by the ICSI. One of the initiative is issuing of the Secretarial Standards and Guidance Notes on the topics of professional and corporate interest. To understand and appreciate the nuances of Related Party Transactions (RPTs), it is necessary to understand the various provisions of law and the related aspects which need explanation. Hence, the Guidance Note on RPTs is formulated by the Secretarial Standards Board of ICSI, which aims to explain the procedures, practices and compliances associated with RPTs. For the benefit of all stakeholders, the Guidance Note on RPTs is available on ICSI website at the link www.icsi.edu/whats-new/.

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ADVISORY FOR COMPANY SECRETARIES IN PRACTICE COMMUNICATION TO PREVIOUS INCUMBENT MANDATORY BEFORE ACCEPTING ASSIGNMENT

Clause (8) of Part I of the FIRST SCHEDULE to the Company Secretaries Act, 1980 provides that a Company Secretary in Practice shall be deemed to be guilty of professional misconduct if he

·       accepts the position of a Company Secretary in Practice previously held by another Company Secretary in Practice without first communicating with him in writing.

The primary requirement under this clause is of prior communication with the previous incumbent This is intended for reasons of professional courtesy.

In accordance with the above, the Council of the Institute has resolved that it shall be

·       mandatory for every Company Secretary in Practice, before accepting any of the following assignments to communicate to the previous incumbent, in terms of Clause (8) of Part I of the First Schedule to the Company Secretaries Act, 1980,

(i)             Signing of Annual Return in Form MGT-7 under Section 92(1) of the Companies Act, 2013 and Rule 11(1) of the Companies (Management and Administration) Rules, 2014.

(ii) Certification of Annual Return in Form MGT-8 under Section 92(2) of the Companies Act, 2013 and Rule 11(2) of the Companies (Management and Administration) Rules, 2014.

(iii) Issuance of Secretarial Audit Report in terms of Section 204 of the Companies Act, 2013.

(iv) Issuance of Secretarial Audit Report to material unlisted subsidiaries of listed entities (whose equity shares are listed) under Regulation 24A of SEBI (LODR) Regulations, 2015.

(v) Issuance of Annual Secretarial Compliance Report to Listed entities (whose equity shares are listed) under Regulations 24A of SEBI (LODR) Regulations, 2015.

(vi) Certification under SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of Companies by the Board/Ministry of Corporate Affairs or any such statutory authority under Schedule V, Part C, Clause(10) (i).

(vii) Certification under Regulation 40(9) of SEBI (LODR) Regulations, 2015 certifying that all certificates have been issued Within thirty days of the date of lodgement for transfer, sub-division, consolidation, renewal, exchange or endorsement of calls/allotment monies.

(viii) Conduct of Internal Audit of Operations of the Depository Participants registered with NSDL and CDSL under the Bye Laws issued by NSDL and CDSL.

(ix) Certification under Regulation 76 of SEBI (Depositories and Participants) Regulations, 2018 for Reconciliation of Share Capital Audit.

(x) Acting as Compliance Auditor under third party certification/ Audit Scheme (Amendment), 2018 in the State of Haryana.

(xi) Issuance of Audit Report by the unlisted public Companies to be submitted on a half -yearly basis to the ROC, under whose jurisdiction the registered office of the company is situated, under the provisions of the Rule 9A(8) of the Companies (Prospectus & Allotment of Securities) Rules, 2014.

(xii) Diligence reporting for Banks in case of multiple banking/consortium lending arrangements in terms of the circular issued by RBI.

(xiii) Conduct of Internal Audit of the stock brokers/sub brokers under SEBI Circular no. MIRSD/ DPSllI/ Cir-26/ 08 dated 22nd August 2008 and MRD/DMS/Cir-29/2008 dated 21st October 2008.

Accordingly, practicing Company Secretaries are advised that they shall communicate with the previous Company Secretary in practice before accepting any of the services as mentioned in Clauses (i) to (xiii) above, in such a manner that he/she should have in his/her hands the evidence of the delivery of the comunication to the addressee (the previous incumbent).

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MCA

Form CRA-2 is likely to be revised on MCA21 Company Forms Download page w.e.f 24th March, 2019

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ICSI ATTENTION MEMBERS

The submission of Hard copy of Form-D for Issue/Renewal/Restoration of COP through post/in person (hard copy) has been discontinued w.e.f. 01.04.2019 . The members are requested to submit Form D only through online mode through ICSI online services.

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NCLT SLAPS FINE ON CARATLANE FOR COMPANIES ACT VIOLATION

The Chennai Bench of the National Company Law Tribunal (NCLT) has imposed a fine on CaratLane Trading Pvt Ltd, a Tata Group company and subsidiary of Titan, its Managing Director and Company Secretary, for not constituting a nomination and remuneration committee in 2016 — as mandated under Section 178 of the Companies Act, 2013 — when the company’s turnover had crossed ₹100 crore. The order, issued by a Single Bench consisting of Mohd Shariff Tariq, Member (Judicial), said the Assistant Registrar of Companies, in a report, had noted that CaratLane became Titan’s subsidiary on August 4, 2016, when its turnover had crossed ₹131 crore. The company should have constituted a nomination and remuneration committee by September 4, 2016, in compliance with the Companies Act. However, it constituted such a committee, and appointed an independent director, only on March 20, 2018. CaratLane had constituted the committee on January 19, 2017, with non-executive directors. However, it did not fulfil the requirement of Section 178(1) of Companies Act, which stipulates the presence of independent directors in the committee. It was only on March 20, 2018, that the company appointed Neelam Chhiber and Mathrubootham Rathnagirish as independent directors, and the committee was reconstituted immediately. The period of violation was from September 4, 2016, to March 19, 2018, the report by the Assistant Registrar said. CaratLane pleaded for a lenient view on the grounds that it was a first offence, and this was confirmed by the concerned Registrar of Companies. The NCLT imposed a fine of ₹3 lakh on the company and ₹50,000 each on Mithun Padamchand Sacheti, Managing Director, and Bharatraj Panchal, Company Secretary. The company was directed to pay the penalty from its accounts but the two officers shall pay from their own resources, the order said.

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COMMUNITY PLATFORM LOCALCIRCLES SEEK EXTENSION OF ACTIVE VERIFICATION FILING FOR STARTUPS BY JUNE 1

LocalCircles, which hosts a community of over 30,000 startups on its platform, in a letter to the Minister of Finance and Corporate Affairs Arun Jaitley sought an extension of April 25 deadline for companies (incorporated on or before December 31) to file e-form INC-22A — ACTIVE to June 1, 2019. The filing is allegedly another regulatory challenge following the controversial Angel Tax issue for startups. The request for extension is triggered by requirements from the government that are seen as challenges for startups to fulfil including Photograph of the registered office showing external building and inside office also showing therein at least one director/KMP who has affixed his/her digital signature to this form, the document said. This is because many startups operate out of shared office spaces such as co-working spaces or occupy a small area in a large commercial building and also often the director, in case of a growing startup with multiple offices, is not based out of the one mentioned in the filing. Most government-recognised startups operate out of shared spaces or have a small office in a large corporate building and its almost impossible for them to get a board put on the external building and take a geotagged picture, Founder and Chairman at LocalCircles Sachin Taparia told. Since Ministry of Corporate Affairs already has their details like financial returns, annual filings, they should be exempted from filing form INC-22 ACTIVE or at least given an extension till June 1, 2019, added Taparia.

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IBC IMPLEMENTATION TO GET MORE SEAMLESS IN ONE YEAR: SAHOO

Implementation of the Insolvency and Bankruptcy Code (IBC) is likely to become more seamless in the next one year, a top official said on Monday. Issues like efficiency of insolvency resolution and the liquidation framework for corporates, individual and partnership firms are likely to a go through a relook Insolvency and Bankruptcy Board of India (IBBI) Chairperson M S Sahoo said. Sahoo said some of the changes in the code can be expected by April next year. The regulations are expected by March end, so that the people know that a new law is coming by April, Sahoo said. Some of the main topics that will come up for discussion in the next one-two years are those relating to personal and corporate insolvency, group insolvency and cross-border insolvency. Sahoo added that like any new law, the IBC, too, has challenges to overcome.

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APPEAL PROCEEDINGS CAN CONTINUE AGAINST CO. WHOSE NAME HAS BEEN STRUCK OFF FROM REGISTER OF ROC

High Court by impugned order dismissed appeal filed by the Income-tax Department on ground that it was rendered infructuous as name of respondent-company had been struck off from the register and the said company was dissolved and appeal filed against such Company which stood dissolved would not survive for its consideration on merits Dept. filed special leave before the Supreme Court. The Supreme Court held that the High Court failed to notice proviso (a) to section 560(5) of the Companies Act and further failed to notice Chapter XV of the Income-tax Act which dealt with 'liability in special cases' and its clause (L) which dealt with 'discontinuance of business or dissolution'. These provisions provide as to how and in what manner the liability against such Company arising under the Companies Act and under the Income-tax Act is required to be dealt with. Since the High Court did not decide the appeal keeping in view the aforementioned two relevant provisions, the impugned order who not legally sustainable and had to be set aside. Therefore, impugned order was set aside and case was remanded to the High Court for deciding the appeal afresh on merits in accordance with law keeping in view the relevant provisions of the Companies Act and the Income-tax Act uninfluenced by any observations made by instant Court on merits. CIT v. Gopal Shri Scrips (P.) Ltd.

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CHANGED INSOLVENCY NORMS BY APRIL NEXT TO SPEED UP PROCESS

The Insolvency and Bankruptcy Code (IBC) is in the process of being changed to be effective from the next fiscal to accomodate the fast changing creditor-debtor scenario, according to the Insolvency and Bankruptcy Board of India (IBBI). The IBBI on Saturday invited comments from stakeholders and the public on making changes to the current regulations notified under the IBC, 2016. The changes the IBBI is looking are in the regulations under Voluntary Liquidation Process, 2017, Fast Track Corporate Insolvency Resolution Process regulations, 2017, Liquidation Process, 2016, and the Insolvency Resolution Process for Corporate Persons, 2016, among others. Recent developments like the Supreme Court striking down the Reserve Bank of India's (RBI) circular last year on banks resolving their massive non-performing assets (NPAs or bad loans) has also made a case for review of certain criteria in the overarching laws of IBC, the IBBI said in notice. In a dynamic environment the stakeholders could play a more active role in making regulations. They may contemplate, at leisure, the important issues in the extant regulatory framework that hinder transactions and offer alternate solutions to address them, in addition to responding urgently to draft regulations proposed by the regulator. This is akin to crowdsourcing of ideas, it said. The comments received between April 20, 2019, - December 31, 2019, shall be processed together and following the due process, regulations will be modified to the extent considered necessary. It will be the endeavour of the IBBI to notify modified regulations by March 31, 2020, and bring them into force on April, 1, 2020. Public consultation enable every idea to reach the regulator. Consequently, the universe of ideas available with the regulator would be much larger and the possibility of a more conducive regulatory framework much higher, it added.

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BANKS APPROVE RS 2,400-CRORE RESOLUTION PLAN FOR STEEL ASSETS OF UTTAM GALVA

Lenders to the distressed steel assets of Uttam Value Steels and Uttam Galva Metallics on Sunday approved a Rs 2,400-crore resolution package in a staggered payment plan that requires banks to take haircuts of more than 60% on the loans. Two people aware of the resolution plan said the offer includes equity commitment of Rs 100 crore. Of the total amount, about Rs 650 crore will be paid immediately, with the remaining spread over the next five-six years, said one of the executives aware of the payment plans. A consortium of lenders, led by State Bank of India (SBI), has Rs 6,113 crore of loans outstanding in these two accounts. Other banks with significant exposure to the assets include Punjab National Bank, Canara Bank and Andhra Bank. The resolution professional, Rajiv Chakraborty of PwC, now has until May 7 to get the plan of CarVal Investors and Asset Reconstruction Company of India (Arcil) approved by the dedicated bankruptcy court.

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NCLT CONSULTS CENTRE, IBBI ON JAYPEE INFRA DEADLOCK

This refers to NCLT consults Centre, IBBI on Jaypee Infra deadlock. In response to the severe hardships faced by homebuyers due to incomplete real estate projects the government amended the Insolvency and Bankruptcy Code (IBC) to recognise homebuyers as financial creditors and thereby provided them representation in the Committee of Creditors. Hence, it is disappointing to see the Jaypee Infratech resolution process at a virtual standstill due to the non-participation of home buyers. One solution would be to amend Section 30(4) of the aforesaid Code so as to stipulate that a resolution plan shall be approved by a vote of not less than 66 per cent of voting share of financial creditors actually present in the meeting. Another suggestion is to revisit this threshold of 66 per cent itself. This may be seen in the context of the recent recommendation of Indian Banks Association to the Reserve Bank of India (RBI) on a 90 per cent threshold. The Jaypee Infratech case best illustrates why this recommendation should never be accepted. Earlier this month, the Shipyards Association of India had requested the RBI that the threshold be reduced to 50.1 per cent. This is a valid suggestion which will go a long way in speeding up the resolution process, the prime objective of the IBC.

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FOR NOW, JAYPEE LENDERS UNLIKELY TO ENTERTAIN POSSIBLE ADANI BID: REPORT

Lenders of debt-ridden Jaypee Infratech are unlikely to seek any fresh offers including from Adani Group, till current round of bidding process is complete under the insolvency law, sources said. Last week, Adani Group threw its hat in the ring by expressing interest in submitting bid to acquire Jaypee Infratech and deliver over 20,000 housing units to aggrieved homebuyers. Jaypee Infratech's Interim Resolution Professional (IRP) Anuj Jain informed last week that a meeting of the committee of creditors (CoC) would be held on April 26. The CoC would discuss the revised bids of NBCC and Suraksha, which have been asked to sweeten their offers. Sources said that under the insolvency law, lenders are barred from entertaining fresh bids for any company till the existing bidding process is complete. The second round of Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code is underway. Adani Group had submitted its resolution plan in the first round of CIRP, which was not successful.

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INSOLVENCY & DEBT RECOVERY: ROAD TO RESOLUTION

As india votes in the general elections, the government continues to list its achievements. Among the most discussed moves of late has been the performance of the National Company Law Tribunal (NCLT) and the utility of the Insolvency and Bankruptcy Code (IBC), set up on October 1, 2016. The NCLT received a major jolt in April when the Supreme Court scrapped a February 12, 2018 Reserve Bank of India (RBI) circular that, through an overarching new framework, directed banks to resolve debts over ₹2,000 crore in 180 days, failing which the debtor would be pushed to NCLT for insolvency. Experts have criticised the circular, saying it did not consider sectoral challenges of companies. It was ‘regulatory overreach’ The regulator was exercising the commercial judgement that the banks should exercise, says Nishant Parikh. Along with revising the structure for stressed asset restructuring, the RBI also ended all pre-IBC restructuring schemes such as strategic debt restructuring, corporate debt restructuring and sustainable structuring of stressed assets. The Joint Lenders’ Forum has also been done away with. According to World Bank estimate in its ‘Ease of Doing Business’ parameters, prior to the introduction of the IBC, India took 4.3 years to resolve a case and the recovery rate for creditors was 26.5 percent; the RBI recovery rate was 13 percent through DRT/SARFAESI. With the IBC, 1,484 cases have been admitted by the NCLT of which 79 have been resolved, with a 48 percent recovery rate. Also, 302 cases have been admitted for liquidation, shows December 2018 data from the Insolvency and Bankruptcy Board of India. Because the recovery rate has increased, significantly less capital has to be invested by the government in public sector banks, says Nikhil Shah. The government had budgeted a figure of ₹65,000 crore as recapitalisation of state-owned banks, to meet regulatory capital norms and capital for growth. Data shows that in several high profile cases, including Essar Steel—where over 600 days have passed since it was admitted to the NCLT—decisions towards resolutions have been punctured by legal challenges (even after the plan was approved by the committee of creditors). The IBC has had limited success considering the delays towards final resolution, says Sandeep Upadhyay. The Bankruptcy Code mandates a 270-day deadline to resolve each case, but in several cases the NCLT extended the deadline. Of the first 12 cases referred to the NCLT in May 2017, it approved the resolution plan of only four—Bhushan Steel, Electrosteel Steel, Alok Industries and Monnet Ispat & Energy. Another 26 firms saw mixed progress, with some cases being resolved and others such as the Videocon Group still pending. The RBI circular took decision-making on stressed assets off the leadership of goverment banks, says Upadhyay. The State Bank of India is an exception: It has seen a 67 percent recovery with resolution of four cases through the NCLT till December 2018. The RBI will consider all alternatives before coming out with a fresh circular It is expected to consult lenders, bidders, legal experts and government officials before coming out with a revised framework. The window of 180 days before moving a case to the NCLT might be widened. Shah says there could be financial incentives to drive banks to push the companies towards insolvency. He feels the regulator is unlikely to reinvent the wheel. The RBI is unlikely to go back to the alternative restructuring options, but is likely to offer resolution options outside the NCLT process. In order to avoid delays in resolution, the NCLT may need to curb admitting and hearing applications and challenges at every stage, which have led to appeals and counter appeals. The onus now is on banks to decide on the best route to recover and restructure debt.

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GAIL HIGHEST BIDDER FOR IL&FS WIND ASSETS WITH $689 MILLION OFFER

GAIL (India) Ltd is set to complete the purchase seven wind power plants from India's debt-ridden Infrastructure Leasing and Financial Services (IL&FS), after offering 48 billion rupees ($689.3 million), IL&FS said on Monday. The deal is expected to close within three weeks. GAIL's offer contemplates no hair-cut to the debt of the plants, which is around 37 billion rupees, IL&FS said.

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ADHUNIK CASE: LENDERS TO MOVE NCLT TO DEBAR LIBERTY HOUSE

Lenders to the bankrupt Adhunik Metaliks (AML) are planning to appeal before the National Company Law Tribunal (NCLT) to debar UK-based Liberty House Group (LHG) from the corporate insolvency resolution process (CIRP) and restart the process by inviting fresh bids banking sources close to the matter said. The move comes after Liberty House failed to make the upfront cash payment of Rs 410 crore even within the extended timeline. The lenders are issuing a notice to Sanjeev Gupta-led Liberty House saying that they are rejecting the latter’s proposal to move a joint application before the NCLT’s Cuttack bench, seeking further extension of time for the upfront payment. Liberty had sent some communications to the lenders to move an application jointly before the tribunal for further extension of the timeframe for upfront payment. But we are telling them that a lot of time has already been taken. So, we are not considering any of its appeals as they are not valid, a source at State Bank of India (SBI) told. The matter is listed before the Cuttack bench of the NCLT on April 30.

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NEED IS TO EMPOWER BANKING REGULATOR, NOT CURB RBI’S POWERS

Mounting Non-Performing Assets (NPAs) in the banking system due to corporate defaults is an issue of concern for many stakeholders. It has important consequences for the national economy. When such an issue of public interest is legalistically dealt with in the court as counter-claims between debtor and creditor, the interest of other stakeholders, especially of depositors, receives the least attention. This is the general feeling the common public is left with after the recent judgment of the Supreme Court (SC). It is the money of the depositors that creditors lend in their fiduciary capacity to debtors and hence, the expectation that the government, regulator and the adjudicating authorities will keep depositors’ interests supreme. The pace at which the long-accumulated corporate defaults were getting resolved through the mechanism established under the Insolvency and Bankruptcy Code (IBC) 2016 was too good to believe. We appeared to have found a magic wand to enforce the contractual obligation of debtors and sufficiently empower the creditors. Overall, the IBC has been able to resolve cases involving debt of Rs 3 lakh crore in the last two years. As per the Ministry of Corporate Affairs, the mere threat of promoters losing control of their company or a legal proceeding under the IBC was sufficient to resolve debts worth Rs 1.2 lakh crore without even the need for the Code to kick in. In the prevailing pessimistic perception of crony capitalism, the faith was restored that we are capable of administering a legal system in which corporate defaulters face the consequences. It was the absence of such an effective legal system that forced creditors to find solutions through criminal proceeding, which was not only time consuming but also took many genuine business failures along the criminal proceedings’ path. All this positivity has come to sudden halt with the SC striking down the circular issued by the RBI in February 2018 as ultra vires of the RBI Act. It appears that the manner in which the authority was sought to be exercised by the RBI — rather than the authority itself — was the reason for the order. The Court has taken a view that the regulatory authority exceeded the statutory authority. Did the 2017 amendment that introduced 35AA and 35 AB to the BR Act expand the RBI’s powers or restrict them? In the words of the SC, the RBI could have issued such directions (contained in the impugned circular) under 21 and 35A before the introduction of 35AA and 35AB, but not after. It is an admission that 35AA severely restricted the regulatory authority of the RBI. One wonders, whether that was the intention behind the IBC and NCLT. Now, how easy, time-bound and practicable is it to follow 35AA in letter and spirit? The law as exists says, the Central Government may, by order, authorise the Reserve Bank to issue directions to any banking company or banking companies to initiate insolvency resolution process in respect of a default, under the provisions of the Insolvency and Bankruptcy Code, 2016. How did the central government authorise the RBI? The finance ministry when it issued the notification dated May 5, 2017, authorised the RBI to issue such directions only in respect of a default under the Code. What is the interpretation of a default? Is it a category of default or specific default by specific debtor? The SC order makes it clear that the RBI can direct banking institutions to move under the IBC only (a) if there is a central government authorisation to do so; and (b) that it should be in respect of specific default of specific debtor. The statement of intent when enacting the BR Act in 1949 says it was meant for the protection of depositors’ interests. Hence, the expansive and generic powers granted to the RBI under 21 and 35A. Alas, when the need of the hour is to affirm the authority of the regulator, the subsequent amendments, notifications issued and their legalistic interpretation have circumscribed the regulator. One can imagine the complexity of getting the authorisation of the Ministry of Finance specific to defaults and specific to defaulters. Does it not give undue discretion to the ministry to interpret defaults and defaulters? Will that eliminate or encourage crony capitalism? We have miles to go before we resolve the thousands of NPAs running to more than Rs 12 lakh crore. It is hoped that the authorities concerned will restore public confidence by assigning supremacy to public interest when it comes to regulating banking companies.

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BIMAL JALAN PANEL MAY PEG RBI'S EXCESS CAPITAL AT RS 1-3 LAKH CRORE

Bimal Jalan committee on Reserve Bank of India's capital framework is expected to peg the central bank's excess capital at Rs 1-3 lakh crore which would be 0.5-1.5% of GDP, according to BofA Merrill Lynch Global Research. Transfer of excess RBI capital to the government will not impact liquidity if it is used for bank recapitalisatiin, the firm said in a report. It observed that about Rs 1,00,000 crore from contingency reserves and another Rs 2,00,000 crore from revaluation reserves. The RBI Act does not bar the RBI from transferring excess capital if any, to the fisc, beyond the RBI's annual surplus, economist Indranil Sen Gupta said. The Jalan panel is likely to submit it's report soon.

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RBI MAY CONSIDER 25 BPS CUT AGAIN IN H1: REPORT

The Reserve Bank of India could consider another 25 bps cut in 1HFY20 to address the domestic growth concerns said a report from Kotak Economic Research. Monetary Policy Committee (MPC) would meet six times during 2019-20 and the first meeting was held on April 2. MPC is likely to cut rate by 25 bps in 1HFY20. In sync with the policy statement, the minutes of the MPC also reaffirm our belief that the MPC might consider another 25 bps cut in 1HFY20 to address the domestic growth concerns, the report said. Even though food prices have started firming up, the headline CPI inflation remains well within the RBI's target of 4 per cent. Our trajectory for inflation, however, is slightly higher than that of MPC's as we expect inflation to an inch above 4 per cent from November as against MPC's projection of 3.5-3.8 per cent for 2HFY20. We assign a higher probability of a rate cut in August as uncertainties surrounding the outcome of the election, monsoon and budget would have partly abated by then. On the 25 bps rate cut in April, the report said the MPC minutes have restated caution on growth and reiterated the need to address growth after the objective of low and durable inflation has been achieved. There were, however, some concerns about fiscal slippages and a sharp reversal in inflation due to a weak monsoon. We continue to see room for another 25 bps of a rate cut in 1HFY20 on the back of a benign growth-inflation mix. However, uncertainties surrounding the outcomes of election, monsoons and budget should restrain the MPC from cutting the repo rate in June, the report added. The report further drew the conclusion that benign inflation and weakening growth led the MPC to cut rates. Fading growth momentum and sharp downward surprises to inflation readings prompted the MPC to deliver the second consecutive rate cut in April. While all except Dr Ghate and Dr Acharya had voted for a rate cut, the decision to keep policy stance at 'neutral' was more unanimous with only Dr Dholakia voting for an 'accommodative' stance.

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INDIAN JUNK BOND ISSUANCES SOAR TO 5-YEAR HIGH

Sales of Indian junk bonds have made a big comeback in 2019, almost tripling to hit a five-year high, boosted by a risk-on rally prompted by a dovish U.S. Federal Reserve that has given the Asia market a record start to the year. Indian companies have sold $3.7 billion in high-yield, or junk-rated, bonds so far this year, an increase of 187 percent from 2018, Refinitiv data show. On the basis of benchmark 10-year U.S. Treasuries, interest rates have fallen almost 70 basis points from their peak in 2018. Sales of junk bonds in Asia reached a record $27.5 billion in the first quarter, Refinitiv data shows, much of it driven by Chinese property developers. Indian issuers have also jumped into the market. Steel company JSW Steel Ltd raised $500 million in five-year bonds, while Shriram Transport Finance Company Ltd sold $900 million in three- and three and a half-year bonds. Borrowers can now raise an unlimited amount of funds from offshore markets for at least three years. Previously, the Reserve Bank of India (RBI) had imposed a $50 million ceiling.

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DIRECT GOVT AND DGCA TO PROVIDE REFUND TO JET PASSENGERS: PLEA IN DELHI HC

Following the grounding of Jet Airways, a petition has been moved in the Delhi High Court, which seeks the court’s orders directing the Centre and the Directorate General of Civil Aviation (DGCA) to adopt a prompt redressal mechanism for full refund, reasonable compensation or alternative mode of travel for passengers with valid tickets of the airline. The petitioner contends that all other airlines have exorbitantly increased their fares and the toothless and vulnerable consumers are constrained to suffer. The court will hear the petition on April 24.

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NARESH GOYAL'S FIRM HAD RS 260 CRORE CASH WHEN FINANCIAL CRUNCH HIT JET AIRWAYS

Naresh Goyal-owned company Jetair Pvt Ltd (JPL) did not employ any of its credit facilities from banks to stay debt-free at a time when Jet Airways was manifesting signs of financial distress. The credit facilities with JPL which is a general sales agent (GSA) to Jet were to the tune of Rs 28 crore. JPL had a cash reserve of Rs 260 crore as on December 2018. Jetair's stake was divested in UPS Jetair Express in October 2018 and around Rs 232 crore in cash was raised. The company submitted an Expression of Interest (EOI) to acquire Jet Airways on April 12, after the deadline to submit the bids ended. The EOI was not accepted as other bidder objected to it, the Business Standard reported. Listed entity Jet was Jetair's main source of revenue. The private company was getting around Rs 4 crore per month from Jet for offline bookings as a GSA. As the airline has shut operations (temporarily) now, it has also left JPL in the lurch. The company was getting a commission of up to 1% from the BSE-listed Jet India and up to 3% from other airlines. JPL also got a commission of 2.5% on the cargo bookings from all airlines, the report said. Some bankers are of the view that JPL's offer to acquire Jet was far-fetched because Jet's cash flow hinged on the financial profile of the airline as it contributed almost 78% to JPL's total income. Jetair was forced to extend the collection period from Jet Airways from 190 days (as of March 31, 2016), to 271 days (as of March 31, 2018). The extension was made on account of dwindling liquidity of the airline over the past few years. The report further said that as Jet Airways was showing signs of the financial crisis, JPL began de-risking its revenue model and expanded operations in the call centre business. The company as a result of this diversification decreased its share of commission income it earned from Jet Airways to 78% in FY 18 from 84% in FY16. JPL posted revenue of Rs 86.4 crore for the Financial Year ending March 2018 as compared to Rs 75.5 crore for FY17. The company also reported a net profit of Rs 22.4 crore in the same period for FY18 as against Rs 21.4 crore in FY17. While Jet Airways defaulted on its debt payments from December 2018, JPL did not take any long-term secured loan. It had Rs 2.19 crore worth of outstanding working capital borrowings.

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JET AIRWAYS WAITS FOR THE NEW OWNER AS RIVALS MUSCLE IN ON TERRITORY

A revival of Jet Airways India Ltd., once the nation’s biggest carrier by market value, is at risk as days roll by since its operations were completely halted. While the cash-strapped carrier awaits potential investors to pump in money, rivals are aggressively going after its most prized assets. A government desperate to limit public backlash after flight ticket prices escalated is parceling off landing and parking slots at congested airports. Lessors are also adding to the woes by allocating grounded aircraft to competitors. It appears to me that lenders are not very confident of getting any serious bid, said Harsh Vardhan. You can not hold on to slots, and planes are not Jet Airways’ property. They have to find a buyer as soon as possible. Jet Airways, the oldest surviving private airline which broke into a monopoly of Air India Ltd., had a fleet of 124 and flew profitable routes like connecting India, the fastest growing aviation market in the world, with London and Toronto. With nearly 23,000 jobs at stake, its collapse last week couldn’t have at worse time for Prime Minister Narendra Modi who’s seeking a second term based on his business-friendly image. While the arrangement to give Jet’s landing slots and aircraft to rivals is temporary, the process to swap them again is complicated and is the domain of airports. It may get more difficult once rivals start new flights and sell tickets in advance, and that could potentially leave close to nothing for a potential new owner. The airline, which controlled 13.6 percent of the local market as recently as January, needs 85 billion rupees ($1.2 billion) to restart operations. So far, it isn’t clear whether Jet Airways will find a buyer to fly again, or if lenders will take it to a bankruptcy court. Over the weekend, local media reported Mukesh Ambani, Asia’s richest man, and salt-to-software conglomerate Tata Group are keen to pick up a stake or purchase Jet’s assets. Ambani, who controls Reliance Industries Ltd., may partner Abu Dhabi’s Etihad Airways PJSC to pick up a stake in Jet Airways, while also exploring a possible bailout of state-run Air India Ltd, the Indian Express newspaper reported over the weekend. Etihad, which already owns 24 percent of the Jet Airways, has put in an initial bid showing interest in purchasing a stake in the carrier, the newspaper said. The Tata Group may jump into the fray if the sale process fails, and bankruptcy proceedings kick in, the Mint newspaper reported separately, citing two unidentified people. The government reached out to the group, which has a majority stake in two local airlines, last year to potentially bail out the airline but it did not materialize into a deal.

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JET AIRWAYS: THE PERILS OF DEBOARDING WITHOUT THE IBC PARACHUTE

While Jet’s troubles began surfacing in as early as June last year when the company postponed its quarterly results announcement, bankers acknowledged the decay only after the airline defaulted on its loans for the first time in January. This is despite Reserve Bank of India (RBI) asking banks to red flag potential stress on their loans Jet’s nosedive took bankers by surprise somewhat and the scramble for a resolution plan began. But bankers dragged their feet on this and refused emergency funding on fears that they will come under the glare of investigative agencies later on. It has taken four months for bankers to begin the bidding process, too long for Jet Airways to stay afloat. In the meantime, the banking regulator’s circular that mandated bankers to put in place a resolution plan was squashed by the Supreme Court. That just made it easy for bankers to extend and pretend. It is no wonder that the parachute of escape that bankers used was faulty. All they had to do was refer Jet Airways to insolvency courts in the first instance. The real benefit of the IBC process is that it would have put a timeline on every step, from the appointment of a resolution professional to the framing a resolution plan. Besides, lenders’ hopes of finding a bidder for Jet is also something that can happen under the IBC framework. It’s incorrect to state that the process of finding bidders is best done outside of IBC.

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JAITLEY PROMISED TO LOOK INTO JET AIRWAYS' ISSUES: CEO

Dube, along with Maharashtra Finance Minister Sudhir Mungantiwar, civil aviation secretary Pradeep Singh Kharola, the airline's chief financial officer Amit Agarwal, representatives of pilots, engineers, cabin crew and ground staff unions met Jaitley at his residence in Delhi. At least one month's salary was needed to be paid to the employees for retaining them, Dube said. To keep them where they are and to give them hope we need to pay them at least a month's salary or more. The finance minister has assured us to look into that, Dube said after the meeting. Jet Airways, has not paid to its entire staff for March. Jet would require around Rs 170 crore to clear at least one month's salary of its employees, Dube stated. During the meeting which lasted for more than an hour, the Jet CEO also said that competition in the aviation sector is important and requested the Union Finance Minister to ensure an open, transparent and efficient bidding process. The Jet Aircraft Maintenance Engineers Welfare Association (JAMEWA) also submitted a representation to Jaitley, saying the airline is sinking for want of funds and taking away the livelihood of 23,000 people.

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NASIM ZAIDI QUITS JET AIRWAYS BOARD

Grounded carrier Jet Airways on Monday said its non-executive and non-independent director Nasim Zaidi has quit the board, citing personal reasons and time constraints Zaidi, the former Chief Election Commissioner and ex- civil aviation secretary, joined the Jet Airways board in August last year. This is to inform you that Nasim Zaidi has submitted his resignation as a non-executive, non-independent director of the company with effect from April 21 due to personal reasons and constraints of time, Jet Airways said in an exchange filing.

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JET EMPLOYEES' UNION ASKS REGULATOR TO NOT ALLOCATE SLOTS TILL BIDDING ENDS

A Jet Airways employees' union has asked aviation regulator DGCA to stop allocation of the airline's slots to other carriers till the bidding process for stake sale is complete. The All India Jet Airways Technicians Association (AIJATA) also cautioned that in case the allocation is not stopped, it would be forced to resort to legal means for a resolution. Cash-starved Jet Airways suspended operations last week and the authorities are in the process of allocating the airport slots vacated by the carrier to other airlines, amid efforts to increase capacity to meet peak season traffic. Jet Airways' lenders have invited bids for selling stake in the ailing airline and the final bidders are likely to known by second week of May. SBI is the lead lender. In a communication to the Directorate General of Civil Aviation (DGCA), the grouping has requested the regulator to immediately pause the slot allocation process till the bidding process is complete and to protect the value of the company. Otherwise we will be forced to knock the legal doors for a resolution, it said.

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TATAS MAY BE WAITING IN THE WINGS TO BUY JET AIRWAYS

The Tata group may revive an attempt to buy Jet Airways (India) Ltd if lenders to the grounded airline fail to find a buyer and are forced to drag the carrier to a bankruptcy court, said two people familiar with the discussions at India’s largest conglomerate. Despite its early interest in Jet Airways, the Tata group chose to skip an ongoing sale process to find a buyer for the airline, which has received interest from four potential bidders. If the ongoing sale process does not succeed, then there is a high possibility that the lenders will take the airline to bankruptcy, the first person cited earlier said on condition of anonymity. The Tatas have explicitly told Jet’s lenders that they will explore a deal once again only if it is available via the bankruptcy courts. The Tata group feels that there is need for a complete overhaul of Jet’s contracts with all third parties, which the group feels could significantly improve the airline’s bottom line and financial performance, said the second person cited earlier. This, apart from Goyal’s continuity in Jet Airways, were the two key contentious issues then. At the time the Tata group pulled back from talks with Jet Airways, Gthe group feels could significantly improve the airline’s bottom line and financial performance, said the second person cited earlier. This, apart from Goyal’s continuity in Jet Airways, were the two key contentious issues then. Acquiring Jet Airways through the bankruptcy process would insulate the acquirer from all of the above risk factors and this is the primary reason why there was no bid from the Tatas, said the first person.

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SUBHASH CHANDRA SELLS ESSEL GROUP CO; BLACKSTONE COMES TO ZEE GROUP FOUNDER’S RESCUE

US-based private equity giant Blackstone has agreed to acquire a majority stake from promoters in Subhash Chandra-led Essel Propack for about Rs 2,157-3,211 crore giving much-needed cash to the billionaire founder of Zee group to repay lenders. Blackstone has agreed to pay Rs 134 per share to the promoters to buy a 51% stake in Essel Propack. The promoter and promoter group holds 57.03% as on March 31st 2019. Subhash Chandra, has recently found himself in some trouble over being unable to pay back loans to creditors. Meanwhile, two major mutual fund houses in the country — Kotak MF and HDFC MF — had their fixed maturity plans come to an end, with exposure to debt securities in Subhash Chandra’s companies. Kotak MF offered part repayment to its investors, holding back the amount invested in Subhash Chandra companies, while HDFC MF offered to roll over the plan on maturity. Subhash Chandra had promised to arrange money by the end of September moratorium by selling group assets and pay the lenders their dues. Essel Propack is one of the early ventures of Subhash Chandra, and is the Essel group’s cash cow. It is involved in the business of manufacturing laminated plastic tubes, extruded laminated plastic tubes, caps & closures and flexible laminates used in packaging of oral care products, cosmetics, food and pharmaceuticals. The major customers in India include Dabur, Baba Ramdev-led Patanjali (oral care); Godrej, Emami, Vicco, Marico (skincare), Sun Pharma, Dr Reddy’s and Piramal. Blackstone will also make an open offer for 26% additional stake in Essel Propack for Rs 139.19 per share. The open offer price has been fixed at Rs 139.19 per share. Therefore, based on the open offer subscription, the purchase price consideration will vary between Rs 2,157 crore and Rs 3,211 crore (or, approximately $310 million – $462 million). The sale is expected to complete in the coming months, subject to customary closing conditions and approvals, Essel Propack said in a media release.

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RPOWER, JET AIRWAYS AMONG 34 STOCKS EXPELLED FROM NSE'S DERIVATIVE SEGMENT

The National Stock Exchange (NSE) on Monday announced expulsion of 34 securities from the derivatives, also known as futures and options (F&O), segment. The move follows tightening of section criteria for stocks in the derivatives segment by market regulator Securities and Exchange Board of India (Sebi) last year. NSE has said the existing unexpired contracts for the securities for the month of April, May and June will be available for trading. However, no contracts will be available for trading in these 34 securities from June 28.

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FOREIGNERS TURN TAIL ON INDIAN BONDS, CONTINUE TO BUY STOCKS

Global funds pulled a combined 89.5 billion rupees ($1.3 billion) from local sovereign and corporate bonds so far this month, according to data from the National Securities Depository Ltd. That’s a reversal from 166.4 billion rupees of purchases in March. Elevated oil prices, a rise in U.S. Treasury yields and India’s central bank taking a less dovish path than many had expected are among the key reasons for the outflows, according to Nagaraj Kulkarni. The withdrawals have been highest in corporate debt totaling almost 74 billion rupees. That compares with inflows of 147.7 billion rupees last month after the Reserve Bank of India eased rules on foreign investment into company bonds. Global funds have bought shares worth $684 million so far this month, taking the year-to-date purchases to more than $7.5 billion, the highest among major Asia markets tracked by Bloomberg.

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NANDAN NILEKANI LAYS OUT DIGITISATION, AADHAAR, GST BENEFITS; SAYS, DIRECT BENEFIT CAN REVIVE POWER SECTOR

India’s direct benefit transfer scheme, the largest such programme in the world, can help revive the stressed power sector said Nandan Nilekani. This, and others, are among the numerous benefits to the Indian economy being brought about by increasing digitisation and use of Aadhaar — the country’s unique ID programme, he said. Nandan Nilekani was also the first chairperson of the Unique Identification Authority of India, the parent organisation of Aadhaar. Nandan Nilekani applauded these programmes and stressed on the need for digital infrastructure to revive the economy Aadhaar e-KYC has been revolutionary in making life simpler for people, Nandan Nilekani said. India now has the infrastructure to deal with direct benefits transfer (DBT) in any segment, he said, adding that DBT has the potential to revive the power sector. Nandan Nilekani sought to allay the concerns over data privacy, linked to Aadhaar. The activists have mixed the issue of commercialisation of data and surveillance using data, he said. In fact, the act has strengthened the data privacy law and the privacy argument is broader than just being limited to Aadhaar data, he said. The Aadhaar implementation agency has not been collecting data on anyone and has taken several measures to prevent commercialisation of Aadhaar data, he added. Nandan Nilekani also lauded the success of the Goods and Services Tax Network (GSTN), pointing out towards the increase in number of taxpayers. GSTN is a great example of technology-led cooperative federalism, he said. Infosys was the nodal agency responsible for development and maintenance of GSTN.

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NEW GOVERNMENT SHOULD FOCUS ON CAPITAL SPENDING WITHOUT SACRIFICING FISCAL PRUDENCE

Driven by structural reforms and macroeconomic stability India has been able to maintain growth in the face of a global slowdown and uncertainties. The country stands as a strong contender to lead global economic growth But, this warrants sustained macroeconomic stability, which can be attained by maintaining fiscal and monetary discipline. The new government should aim for fiscal prudence by containing excessive tilt towards socialist spending. A focus on capital spending for meaningful growth in infrastructure capabilities is vital. While it is essential to strike an optimal balance between social spending and infrastructure expenditure, the new government will have to be mindful of the fact that indirect tax collection is yet to reach the expected level. Therefore, it must prioritize fiscal prudence. Also, efforts should be made to keep inflation in check. So far, the consumption has been a key growth driver for India, and investment has lagged. At present, multiple moving parts are at work, contributing to the moderation in consumption growth. This calls for a shift in focus to other growth drivers, including exports and investments. Data shows that private sector capex, which rose to Rs 3.7 trillion in 2010-11, has witnessed a declining trend over the past seven years, led by weak demand, high leverage, delays in land acquisition/clearances and a decline in project sanctions by banks. New investment proposals in 2018-19 stood at a 14-year low primarily attributable to a dip in the share of private sector investments. This calls for continued public sector contribution to create and enhance infrastructure which holds the potential to resurrect the slack in private sector capex. Also, reforms will be needed to speed up new project sanctions and better credit flow to the private sector form important pillars for supporting the private sector capex growth. Major global central banks are now reverting to an easy monetary stance. This development along with data-driven approach by the RBI to determine interest rate creates room for the Indian central bank to reduce and maintain the interest rate at reasonable levels over the medium term—a credit-positive for the private sector. These factors should, in turn, prepare a conducive backdrop for a sustainable recovery in private capex over the medium term. In order to revive the housing construction sector, necessary steps to implement real estate regulations and tax incentives are warranted so as to bring back the buyer interest in the sector. Enhancing productivity through reforms in the areas of Ease of Doing business (EODB), labour laws, land acquisition, simplification of FDI norms and strengthening of legislation to safeguard foreign investor interest are critical. Building on existing reforms to make them robust and effective is also as important as introducing additional reforms. The need to bring economic growth back on track and sustain a reasonable growth over the long term while addressing productivity issues and job creation necessitates the effective implementation of existing reforms. It also addresses bottlenecks by introducing policies that are well-thought through and judiciously implemented.

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GOOD NEWS FOR STARTUPS IN TIER LL, LLL CITIES AS ANGEL INVESTORS RISE BEYOND METROS, SAYS INDIAN ANGEL NETWORK

Prominent network of angel investors Indian Angel Network (IAN) has said that 12-15 per cent (60-75) of its near 500 member base now comes from tier-II and tier-III cities even as the number is growing steadily year-on-year. The next wave of angel investments in startups would be coming from angel investors based in these cities that have registered robust growth over the past couple of years and one of the key reasons behind this shift being growing digital connectivity, Padmaja Ruparel told. India’s first angel network IAN, which claimed to be the world’s largest network of angels, has invested over Rs 40 crore in 10 startups (Rank Junction, Druva Software, Bizcrum, Clootrack etc) from cities including Nagpur, Pune, Belgaum, Ahmedabad, Kochi and Madurai. Importantly, the reason for India to have more start-ups emerging from such cities regions is socioeconomic. If start-ups are concentrated in metropolitan cities, the wealth, business, and value they create will also remain largely restricted to these regions. This, from the country’s larger socioeconomic standpoint, is not a preferable outcome. Value creation accelerates when there is a free exchange of talent, ideas, business, and capital between several interconnected markets. By promoting more promising start-ups in tier-2 and tier-3 markets, angel investors can help in nurturing a conducive environment, said Ruparel.

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UP RERA REJECTS APPLICATIONS OF 36 REAL ESTATE PROJECTS

Uttar Pradesh Real Estate Regulatory Authority (UP RERA) has rejected applications of nearly three dozen commercial and residential real estate projects located in Lucknow, Gautam Buddha Nagar, Ghaziabad, Varanasi, Agra, Bareilly and Meerut as the concerned developers had not completed the formalities or the requisite documentation required for registration, top UP RERA officials said. The developers are now required to reapply for RERA registration. As many as 36 commercial and residential projects have not been registered as they had failed to meet the standards. They had applied for registration but after scrutiny it was found that at this stage they are not fit to be registered since they had failed to fulfill formalities. In some cases the maps had not been passed and in others the land title was not in place. Once the developers complete all these formalities, they can reapply for a registration number, Rajive Kumar, told. Applications of at least four commercial and 32 residential projects have been rejected. All ongoing projects have to be registered. To register a project developers have to adhere to a host of formalities. When a developer applies for registration with RERA we ask for a report from the concerned development authority and only when the authority affirms that all plans are in place and all formalities have been completed, do we register the project, Balwinder Kumar, UP Rera member, told. Most of these developers were sent showcause notices to explain and complete the formalities or documentation but they failed to respond or turn up. We, therefore, decided to cancel their applications. Only after they have completed all the formalities can we reconsider their application, he adds. It is mandatory under RERA for all projects above 500 sq m or those having over eight kitchens to register under RERA.

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WORK-FROM-HOME JOBS TO BE INCENTIVISED UNDER NEW BPO POLICY

Ministry of IT and Electronics plans to expand its BPO promotion scheme, under Digital India programme, to include work-from-home options for incentivising firms to set up new units Besides, there is already a proposal to double the number of seats to be set up under the scheme from earlier 48,300. The total seat allocation in nine rounds of bidding has already crossed the earlier targeted number and reached 51,297. The ministry has given in-principle approval to around 20 companies for setting up new BPO/ITeS units in Tier II and III cities for 4,034 seats. Around 24 new units will be set up after the ninth round of bidding, a senior ministry official told. The BPO promotion scheme was launched in 2016 with an outlay of Rs 493 crore for three years, where financial support up to Rs 1 lakh/seat in the form of viability gap funding (VGF) was given to the firms. The aim was to generate employment for around 1.5 lakh people. The plan is to expand the scheme to another three years with an outlay of around Rs 300 crore. Work from home jobs need to be incentivised as well, especially for women, who are not able to work full time due to family responsibilities. This has potential of creating another 50,000-1,00,000 new jobs, the official from the ministry said.

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DEMAND SURGES FOR HYDERABAD'S LEASED OFFICE SPACE DESPITE CRAMPED SUPPLY

A spurt in office space absorption in Hyderabad during the January-March period this year indicates not just an increased demand for grade-A office space in the city, but also the lack of adequate supply according to real estate experts. For the first time, the city of Nizams surpassed India's silicon valley, Bengaluru, in office space absorption in this three-month period, though it hasn't been able to match the latter in terms of volume or sustained supply of office space over a longer period in the past. According to property consultant CBRE's recent report, Hyderabad has seen office space deals totalling 3.2 million square feet in January-March compared with 2.5 million square feet offtake in Bengaluru. Together, the two southern cities have accounted for over 47 per cent of the total volume of office space absorption across nine cities, including NCR and Mumbai, in the three-month period. This has happened at a time when the overall office space offtake remained flat at 12.8 million square feet. Same time last year the office space absorption numbers for Hyderabad and Bengaluru stood at 5.5 million sq ft and 1.1 million sq ft respectively and even on a sequential basis, the offtake was 1.6 million sq ft and 3.2 million sq ft for the two cities respectively in October-December 2018, as per to CBRE's data. The sudden jump seen in office space absorption in Hyderabad was largely due to the fact that in the first quarter, the city saw new Grade-A supply hit the market, which has been relatively low over the last few years. For instance, the overall new office space supply in 2018 in Hyderabad was limited to 1.7 million sq ft, which in Bengaluru was nearly 9.6 million sq ft during the same period. Clearly, even while demand is very high in Hyderabad, the city lacks new supply. Hence, as soon as new supply hit the market, occupiers came forward to lease space, Anuj Puri, said. To assume that Hyderabad will henceforth steal the show from Bengaluru in office leasing activity in 2019 may not be entirely accurate, according to Puri. The CBRE data for the three month period show that the city of Hyderabad witnessed a supply addition in the form of one large-sized SEZ and two IT developments in Raidurg and Kondapur in IT Corridor II, one medium-sized SEZ in Kokapet in Extended IT Corridor and one medium-sized SEZ in peripheral business district (PBD). Part of the reason why there was a renewed influx of office space in Hyderabad was explained by CBRE senior director Romil Dubey, as he sought to predict the trend in coming quarters based on the current data: Hyderabad witnessed increase in rental values by about 2-5 per cent and 3-6 per cent quarter on quarter, owing to increased occupier interest towards recently completed developments. Going forward we expect Hyderabad, among others, to account for a substantial share of SEZ pipeline in the upcoming quarters. Given the approaching sunset data, we foresee an increase in demand for SEZ space, he said in the recent report. At the peak of sanctions by the Board of Approvals (BoA) the developers in Hyderabad received approval for more than 30 IT SEZs in and around Hyderabad prior to the state bifurcation. As per the sunset clause, only those SEZs and the SEZ units that become operational before March 31, 2020 are eligible to claim incentives offered under the SEZ Act, there has been a clear rush as far as SEZ projects in Hyderabad was concerned. According to a report released by CBRE last year, almost 90 percent of the SEZ stock was located in Hyderabad.

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GOLDMAN SACHS REPORT SAYS JAPAN IS STILL HOLDING BACK TALENTED WOMEN

Working women are playing a bigger role in Japan than Goldman Sachs’ Kathy Matsui thought possible when she penned her first report on Womenomics in 1999. Yet the country needs to pick up the pace of change or risk being overtaken by a demographic crisis. Two decades ago, Matsui struck an optimistic note amid general gloom over Japan in her first analysis of women in the economy, setting out how empowered women could bolster flagging growth as the population aged. In a new version out this week, Matsui, now chief Japan strategist, explains how Japanese women continue to trail their peers in other developed countries in many respects, even as they pour into the labor force in ever-increasing numbers. There are now 3 million more women working outside the home than in 2012, yet they earn on average only three quarters as much as men, partly because so many are in part-time roles. This country is already on the brink of a demographic crisis, Matsui said. If your sole key resource as a nation is your human capital, you don’t have a lot of options but to leverage every single human being. Matsui gives Prime Minister Shinzo Abe a patchy score card in her report — highlighting the slow progress on his pledge to increase women’s representation in leadership, and shortfalls on Abe’s targets for men taking paternity leave and mothers staying in work. Untapped Potential Japan, which is set to lose 40 percent of its working-age population by 2055, is already missing out on what could be a 15 percent boost to the economy if women worked to their full potential, according to Matsui. That would entail not only raising the proportion of women in work to match that of men, but having each of them work longer hours. Matsui notes that Japan’s labor participation rate for women has soared to 71 percent — higher than in the U.S. and Europe, even amid blatant gender discrimination in fields from education to politics. A Tokyo medical university made headlines last year when it admitted to excluding women in favor of less qualified men. Japanese receive some of the most generous parental leave allowances in the world, yet few men take advantage of them, and women face barriers to returning to work because of childcare shortages. Working mothers suffer because Japan’s fathers do less housework than their counterparts in other developed countries. Abe, a conservative, jumped on the Womenomics bandwagon after he returned to office in 2012, becoming an unlikely champion of working women as he sought to tackle what he has called the national crisis of the aging and shrinking population. He pledged among other things to put women in 30 percent of management positions in all fields by 2020, though progress toward that goal has been glacial. In politics, only about 10 percent of lower house lawmakers are female, while Abe has just one woman in his 19-strong cabinet.

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CS Meetesh Shiroya