AHMEDABAD | MONDAY, 27 MARCH 2017 COMPANIES 3 . < VIVEAT SUSAN PINTO Mumbai, 26 March T he country’s fast-grow- ing e-commerce industry will finally mark its presence at the Advertising Standards Council of India (ASCI), with Paytm set to become a mem- ber of the self-regulatory vol- untary organisation next month. The move is significant because advertising viola- tions by e-commerce compa- nies, which are big spenders on television, print and digi- tal media, have been on the rise in recent years. ASCI members include key advertisers from various sectors, such as fast moving consumer goods (FMCG), media, auto and telecom, which spend heavily to stay visible in the marketplace. However, no e-commerce company is a member of the body yet. According to the latest update, for November 2016, by ASCI on monthly action taken against errant adver- tisers, six complaints were upheld against e-commerce majors Paytm, Amazon, Cleartrip, Magicbricks, Freecharge and Pepperfry for making false and misleading claims. Paytm had stated in one of its advertisements in November, that it was offer- ing a “flat 50 per cent cash- back”, which was found to be misleading because the cash- back was limited to ~150 only. While Paytm did not respond to a mail seeking comment on why it chose to be a member of ASCI, per- sons in the know say the dig- ital payments firm had approached the council about a month ago express- ing its desire to do so. By opting to be a member, companies submit them- selves to the ASCI Advertising Code, conveying the message that they wish to be responsible advertisers. Any violation, upheld by ASCI, puts the onus on the member to abide by the reg- ulator’s decision. This implies quick modi- fications to advertisements, which if not done could attract stringent action, especially in the case of tele- vision ads. Those who are not ASCI members use it as a lever to not abide by the regulator’s directives, choosing to con- tinue with their original piece of communication. This has, for instance, played out in the case of Patanjali, the ayurvedic consumer prod- ucts major co-founded by Baba Ramdev and Acharya Balkrishna. Patanjali was pulled up earlier by ASCI for making “misleading claims” in its ads, but the company refused to modify its ads, saying it was not a member of the body, taking the matter to court. It is currently being heard in the Bombay High Court. Paytm’s decision is expected to prompt others to follow suit. Flipkart, accord- ing to sources, is also consid- ering becoming a member of the advertising body. Paytm to become member of ASCI It will be the first e-commerce major to take advertising regulatory body’s membership | The move is significant since ad violations by e-commerce firms have been on the rise in recent years | ASCI’s members include sectors such as FMCG, media, auto, telecom etc | No e-commerce company is a member of the body yet | Paytm’s decision is expected to prompt others to follow suit | Flipkart is also in considering to become a member of the advertising body ENTERING NEW AREAS GE Healthcare will invest $300 million (~1996 crore) over five years to deliver affordable care solutions across India, other South Asian countries and Africa. A subsidiary of US-based conglomerate, GE Healthcare delivers health care equipment and technology services that are aimed to reduce cost of care using digital technologies. The firm has also partnered with 11 organisations to provide tech- nical skills to medical industry professionals. While it has trained nearly 6500 people through skill enhancement pro- grammes, GE Healthcare aims to train another 10,000 people annually to extend better health care solutions across smaller cities and towns. “We will invest nearly $300 million across India and South Asian countries to extend our cost-effective health care solu- tions. For example, we are work- ing on a cost-effective imaging facility (CT scan) which will reduce the cost for CT scan by 40 per cent. Affordable incuba- tion facility for premature babies to reduce the infant mor- tality rate,” said Terri Bresenham, president & chief executive officer, Sustainable Healthcare Solutions, GE Healthcare. AYAN PRAMANIK GE Healthcare to spend $300 mn on affordable health care The best B-School to get your Management Degree Toll Free: 18003 - 4565855 www.asbm.ac.in | [email protected]LAST DATE TO APPLY 31-03-2017 PGDM Post Graduate Programme in Management EXCELLENT PLACEMENT RECORD ADMISSION 2017 ASBM gives you the Finishing School Advantage POWER PACKED PERSONALITY & PLACEMENT GROOMING MODULE National Rank A+++ Business India, Dec. 2016 Learn from the Management Guru Prof. Biswajeet Pattanayak Only Asian among top ten Educators of the world as recipient of Management Teaching Excellence Award’16 ACBSP, USA Founder & Group Director Former Professor of IIM, Lucknow & Indore Stay updated through the day Visit www.business-standard.com contact for TENDER advertisement Utpal Desai 9376370320 079-26577747
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AHMEDABAD | MONDAY, 27 MARCH 2017 COMPANIES 3. <
VIVEAT SUSAN PINTOMumbai, 26 March
The country’s fast-grow-ing e-commerceindustry will finally
mark its presence at theAdvertising StandardsCouncil of India (ASCI), withPaytm set to become a mem-ber of the self-regulatory vol-untary organisation nextmonth.
The move is significantbecause advertising viola-tions by e-commerce compa-nies, which are big spenderson television, print and digi-tal media, have been on therise in recent years.
ASCI members includekey advertisers from varioussectors, such as fast movingconsumer goods (FMCG),media, auto and telecom,which spend heavily to stayvisible in the marketplace.However, no e-commercecompany is a member of thebody yet.
According to the latestupdate, for November 2016,by ASCI on monthly actiontaken against errant adver-tisers, six complaints wereupheld against e-commercemajors Paytm, Amazon,Cleartrip, Magicbricks,Freecharge and Pepperfry formaking false and misleadingclaims.
Paytm had stated in oneof its advertisements inNovember, that it was offer-ing a “flat 50 per cent cash-back”, which was found to bemisleading because the cash-back was limited to ~150 only.
While Paytm did notrespond to a mail seekingcomment on why it chose tobe a member of ASCI, per-sons in the know say the dig-ital payments firm hadapproached the council
about a month ago express-ing its desire to do so.
By opting to be a member,companies submit them-selves to the ASCIAdvertising Code, conveyingthe message that they wishto be responsible advertisers.Any violation, upheld byASCI, puts the onus on themember to abide by the reg-ulator’s decision.
This implies quick modi-fications to advertisements,which if not done couldattract stringent action, especially in the case of tele-vision ads.
Those who are not ASCImembers use it as a lever tonot abide by the regulator’sdirectives, choosing to con-tinue with their original piece
of communication. This has,for instance, played out in thecase of Patanjali, theayurvedic consumer prod-ucts major co-founded byBaba Ramdev and AcharyaBalkrishna.
Patanjali was pulled upearlier by ASCI for making“misleading claims” in itsads, but the company refusedto modify its ads, saying itwas not a member of thebody, taking the matter tocourt. It is currently beingheard in the Bombay HighCourt.
Paytm’s decision isexpected to prompt others tofollow suit. Flipkart, accord-ing to sources, is also consid-ering becoming a member ofthe advertising body.
Paytm to becomemember of ASCIIt will be the first e-commerce major to take advertisingregulatory body’s membership
| The move is significant since ad violations by e-commerce firms have been on the rise in recent years
| ASCI’s members include sectors such as FMCG, media,auto, telecom etc
| No e-commerce company is a member of the body yet
| Paytm’s decision is expected to prompt others to follow suit
| Flipkart is also in considering to become a member of the advertising body
ENTERING NEW AREAS
GE Healthcare will invest $300million (~1996 crore) over fiveyears to deliver affordable caresolutions across India, otherSouth Asian countries andAfrica.
A subsidiary of US-basedconglomerate, GE Healthcaredelivers health care equipmentand technology services that areaimed to reduce cost of careusing digital technologies. Thefirm has also partnered with 11
organisations to provide tech-nical skills to medical industryprofessionals. While it hastrained nearly 6500 peoplethrough skill enhancement pro-grammes, GE Healthcare aimsto train another 10,000 peopleannually to extend better healthcare solutions across smallercities and towns.
“We will invest nearly $300million across India and SouthAsian countries to extend our
cost-effective health care solu-tions. For example, we are work-ing on a cost-effective imagingfacility (CT scan) which willreduce the cost for CT scan by40 per cent. Affordable incuba-tion facility for prematurebabies to reduce the infant mor-tality rate,” said TerriBresenham, president & chiefexecutive officer, SustainableHealthcare Solutions, GEHealthcare. AYAN PRAMANIK
GE Healthcare to spend $300 mn on affordable health care
Finishing School Advantage POWER PACKED PERSONALITY
& PLACEMENT GROOMING MODULE
National Rank A+++Business India, Dec. 2016
Learn from the Management GuruProf. Biswajeet Pattanayak
Only Asian among top ten Educators of the world as recipient of Management Teaching Excellence Award’16 ACBSP, USAFounder & Group Director
Former Professor of IIM, Lucknow & Indore
S t a y u p d a t e d t h r o u g h t h e d a y
V i s i t www.business-standard.com
contact for
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BIZ NEWS IN NUTSHELL
The renowned athlete, Ms. P.T. Usha meeting the Minister of State for YouthAffairs and Sports (I/C), Water Resources, River Development and Ganga Reju-venation, Shri Vijay Goel, in New Delhi.
8-year-old World Kickboxing champion Tajamul Islam from J&K, meetingthe Minister of State for Youth Affairs and Sports (I/C), Water Resources, RiverDevelopment and Ganga Rejuvenation, Shri Vijay Goel, in New Delhi.
Par panel asks govtto consider capping airfares
A Parliamentary panel has asked the govern-ment to look at capping air ticket prices and con-trol the artificially crated exorbitant prices in the Gulfsector, the suggestion comes amid persisting con-cerns among certain quarters that airlines are levy-ing high airfares, especially during festival seasons.
BSNL, MTNL merger to help both Cos.Amid renewed push for BSNL-MTNL merger,
BSNL CMD Anupam Sriastava has said the combi-nation will be advantageous for both the state-owned telecom firms but issues pertaining to debtand salary structure will need to be sorted out first.
India should revive IPI pipelineIndian should consider reviving the long delayed
Iran-Pakistan-India (IPI) gas pipeline following easingof sanctions on Tehran, a Parliamentary panel has said.India had almost abandoned the IPI pipeline in 2008.
Field survey for employmentdata to begin soon
The statistics ministry will soon start field sur-vey to bring out annual employment data as thebasic spadework has been completed. However, theMinistry has not given any timeline to bring out newemployment data covering wide spectrum of indus-tries and sectors, but it could be launched in 2019.
Cabinet nod for mergerof BMB with SBI in 3 months
The government is expected to give final ap-proval to the merger of Bharatiya Mahila Bank withState Bank of India within three months. The Cabi-net last month approved amalgamation of five as-sociates of State Bank of India with the parent butthe merger of BMB was not considered, sources said.
RIL’s KG-D6 gas outputslips further: Pradhan
New Delhi: Reliance Industries’ flagging KG Ba-sin D6 block has seen natural gas output slip fur-ther, leading the government to disallow $2756 bil-lion in cost, Oil Minister Dharmendra Pradhan said.RIL and its partners - BP plc of UK and Canada’s NikoResources produced less than 16% of the 31,793.28million standard cubic meters mmscm target formKG-DWN-98/3 or KG-D6 block in 2013-14.
HCL Tech buy-back forRs 3500 crore approved
Mumbai: The Board of HCL Technologies hasapproved a buy back plan aggregating to Rs 3500crore. According to a stock exchange announce-ment, the firm plans to buy back 3.5 crore equityshares at Rs 1000 per share. the equity shares repre-sent 2.48% of the fully paid up equity shares of thecompany as on March 31,2016. The offer size of Rs3,500 crore is 13.62 per cent of the company’s freereserves as on March 2016.
IBM unveils tech to sendweather alert sans Net
New Delhi: IT major IBM unveiled a technologythat can send weather alerts to users even in lim-ited or of internet connectivity. Mesh Network Alertsnetworking technology is designated to notify ofpotential severe weather events or disasters evenin areas with limited internet connection, or cellularnetworks are disrupted due to an outage, he said.
Cognizant gives targetperformance bonus
Chennai: Nasdaq-based Cognizant has doledout target performance bonus to its employees forthe calendar year 2016. The top performance got95% of their target bonus while the opens who fellin the next bracket got 75%. Employees who werein the third bracket got 50%. Cognizant has a per-formance based culture and our variable payout isa function of company and individual performance,the company said. In previous years where we out-performed our goals, we paid significantly above thetarget payout. In 2016, we missed our original goalsand our variable payout is reflective of that. Employ-ees, however, said this was a little less as comparedwith last year.
You can switch from RPF to NPSNew Delhi,
More than eight croremembers of the Employees’Provident Fund, can nowopt to move their retire-ment savings to the Na-tional Pension System over-seen by the Pension FundRegulatory and Develop-ment Authority (PFRDA) --over two years after FinanceMinister Arun Jaitley hadpromised such an alterna-tive for employees in theBudget for 2015-16.
The PFRDA notified theprocedure for EPF membersto transfer their investmentsto the National Pension Sys-tem or NPS on Tuesday.
Terming members ofEPF and Employees’ StateInsurance Corporation(which provides medicalcare to organized sectorworkers) as “hostages,rather than clients”, the fi-nance minister had saidsuch workers’ income sufferdue to high statutory de-ductions towards EPF andESIC.
He had promised to pro-vide employees the optionto leave the EPF and opt forthe NPS and had also saidthat employees below a cer-tain level of monthly in-come could decide if theywanted to stop their owncontributions to the EPF. Inall, 24% of an employee’s
salary is diverted to the EPFas a mandatory retirementsaving schemes.
Active NPS accountAccording to the rules,
the subscriber looking totransfer-funds from EPF toNPS must have an activeNPS Tier-I account, whichcan be opened eitherthrough the employerwhere NPS is implementedor online through eNPS onthe NPS Trust website.
The amount transferredfrom a recognized provi-dent Fund or superannua-tion fund to NPS would notbe treated as income of thecurrent year and hence,would not be taxable.
“Further, the transferredrecognized Provident Fund/Superannuation Fund will
not be treated as contribu-tion of the current year byemployee/employer andaccordingly the subscriberwould not make Income Taxclaim or contribution forthis transferred amount,”the notification clarified.
While the return on EPFsavings this year is ex-pected to be 8,65%, theNPS offers multiple assetallocation for its membersto choose from, with vary-ing rates of returns.
The subscriber, either agovernment or private sec-tor employee, must ap-proach the concerned PFoffice where their moneyresides, through her or hisemployer and request totransfer their savings to anNPS account.
Fast track prosecution cases against shell cos: CBDT to taxmenNew Delhi,
As the noose tightensaround shell companiesevading taxes, the CBDTChairman has asked fieldofficers to file prosecutioncases against those entitieswhich claimed bogus long-term capital gains.
In a letter to PrincipalChief Commissioner of In-come Tax, Central Board ofDirect Taxes (CBDT) Chair-
man Sushil Chandra hascalled for fast track prosecu-tion proceedings in caseswhere the Settlement Com-mission has rejected entryoperators who haveclaimed advantages oflong-term capital gains.
“Prosecution proceed-ings can be successfully ini-tiated in several cases ofentry operators, includingthose concerning bogus
LTCG (Long Term CapitalGains) claims, cases rejectedby Settlement Commission,etc,” Chandra said. The PrimeMinister’s Office last monthhas set up a task force underRevenue Secretary HasmukhAdhia decompressing mem-bers from dental probe andenforcement agencies tomonitor action against de-viant shell companies.
According to the tax de-partment, there are about15 lakh registered compa-nies in India of which only 6lakh file annual returns. Thismeans a large number ofthese companies could beindulging in financial ir-regularities. While the Seri-ous Fraud Investigation Of-fice (SFIO) has filed casesagainst 49 shell companies,Rs 3,900 crore is believed tohave been laundered by559 persons with the help of54 professionals. Also, Rs1,238 crore cash has beendeposited ins hell or dor-mant companies, post-de-monetization. The I-T de-partment is taking steps toplug loopholes in the lawand deter people from
wrongly availing capitalgains benefits. With boguscapital gains of Rs 80,000crore availed by shell com-panies last year coming tothe notice of the I-T depart-ment, the Budget 2017-18has proposed 10 per centlong-term capital gains taxon those who acquiredshares in unlisted compa-nies after October 1, 2004, ifthey had not paid securitiestransaction tax (STT) at thetime of purchase. Since thisis the last month of the cur-rent fiscal year, the CBDTchairman has stressed on aspeedy filling of the pros-ecution and disposal of thepending compounding ap-plication. It is a very goodmove to expedite the mo-mentum to book the de-faulters under the law,”Prakash Sachin & Co PartnerPrakash Sinha said. Shellcompanies are characterizedby nominal paid-up capital,high reserves and surpluson account of receipt of highshare premium, investmentin unlisted companies, nodividend income and highcash in hand.
Also, private compa-nies as majority sharehold-ers, low turnover and oper-ating income, nominal ex-penses, nominal statutorypayments and stock intrade, minimum fixed assetare some of the other traitsof shell companies.
The CBDT, which is theapex policy making bodyof the I-T department, hadin the beginning of the cur-rent fiscal forwarded tofield officers a list of casesin which prosecution couldbe filed. Besides a list of po-tential cases of prosecutionfor TDS default was up-loaded on the Tax De-ducted at Source ( TDS)portal in October, 2016.
“The figures of pros-ecution are not beingcompiled from all thecharges within your regionand reported to the board.Complete and correct re-ports in this regard shouldbe submitted to the Boardafter taking into accountdata from investigation Di-rectorate, Central TDS, LTU,International Taxation,”Chandra said in the letter.
Govt to amend EPF schemeto enable members buy homes
Blame fuels, not food for spike inflationAhmedabad,
It is not the prices of foodbut those of fuel that havedriven the wholesale infla-tion to a 39-month-highlevel of 6.55 per cent in Feb-ruary this year. A year ago,the figure was -0.85 per cent.Price rise in ‘Power and Fuel’category at 21.02 per centled the overall rise in theprices.
According to data re-leased by the central govern-ment, the Wholesale PriceIndex (WPI) of High SpeedDiesel, petrol and cooking
gas stood at 33.14 per cent,16.72 per cent and 4.32 percent respectively, comparedto the negative growth ayear ago.
WPI in primary articlesstood lower at 54 per centcompared to 2.03 a year ago.Within this category, WPI infood items stood at 2.69 percent compared to 3.91 a yearago, while WPI in non-fooditems stood at 6.53 per centcompared to 7.09 a year ago.WPI in manufactured goodscategory stood lowest at3.66 per cent as against -0.52
a year ago.Players in transport sec-
tor say that if the prices offuel in India were kept insync with global trends, theywould have been very low.Instead, the Governmentchose to increase the taxburden on the consumers.“Diesel prices in India havegone haywire because of in-crease in excise duty and sur-charge. In a decade the tolltax burden has increasedsignificantly,” said HitenVasant, former VP of All IndiaMotor Transport Congress.
Industry players say rela-tively lower WPI in manufac-tured goods indicates lowerdemand while higher WPI infood items increases the bur-den on the end consumers.
New Delhi,Government will amend
EPF scheme to enablearound 4 crore members ofretirement fund body EPFOto withdraw up to 90 percent of their fund for mak-ing down payments whilebuying homes, Parliamentwas informed on Wednes-day. The amendment in thescheme will also allow theEmployees’ Provident FundOrganization (EPFO) sub-scribers to use their EPF ac-counts for paying equatedmonthly installments (EMIs)of home loans.
Under the new pro-posed provision in the EPFscheme, EPFO subscriberswould have to form a coop-erative society with at least10 members for availing thefacility. “The Governmenthas taken a decision for
modification in the Employ-ees’ Provident Funds (EPF)Scheme, 1952, to add a newparagraph 68 BD,” LabourMinister Bandaru Dattatreyasaid in a written reply toRajya Sabha on a queryabout Housing Scheme forthe members of EPFO.
The Minister told theleast 10 members of EPF,can withdraw up to 90 percent from the fund for pur-chase of dwelling house/flator construction of dwellinghouse/acquisition of site.”
The proposed provisoalso provides that monthlyinstillments for repaymentsof any outstanding pay-ments or interest may alsobe paid from the amountstanding to the credit of themember, to the Govern-ment / housing agency /primary lending agency or
banks concerned.”The Minister also told
the House that the pro-posed paragraph to be in-serted in EPF scheme hasnot been notified, therefore,no targets have been fixed(for giving advances underthis facility). The Ministertold the House that the to-tal number of EPF memberaccounts as on March 31,2016, as per Annual Reportfor 2015-16, is 17.14 crore.
He further said that onan average, contributionshave been received in re-spect of 3.76 crore mem-bers during the year 2015-16. The withdrawal facilityfrom the Provident Fund(PF) account under theScheme will be available toonly those PF memberswho fulfil the conditionsprescribed,” he said.
Woman mutual fund managers rare in IndiaMumbai,
Women fund managersaccount for only 7% of thetotal number of managersin India’s mutual fund indus-try even though the sectorhas been in existence formore than 50 years, if onetakes into account the intro-duction of Unit Tryst of In-dia (UTI) in 1963. A recentstudy shows that thesenumbers are much lowerthan in other financial cen-tres like Hong Kong andSingapore.
A study by Morningstar,a US headquartered Invest-ment research and manage-
ment firm, shows that thereare only 18 woman fundmanagers out of a total of269 who manage schemeseither as the primary or sec-ondary manager or asheads of equity/fixed in-come schemes. While theshare of woman fund man-gers is pegged at 7%, theymanage 15% of the totalassets under management(AUM) of all open-endedfunds that roughly trans-lates to Rs 2,32,000 crore.
“This is much below theglobal standards withwomen being named fundmanagers at a relatively
higher rate in places such asHong Kong, Singapore,France, Spain, and Israel. Atleast 20% of fund managersare women in these mar-kets,” the report’s authorswrote.
The study has taken intoaccount only open-endedmutual fund schemes.
The study shows thatwomen fund managershave been fairly consistentin delivering returns as ma-jority of such schemes havebeen outperforming theirrespective benchmark in-dex or the peer group aver-age.
“Out of the total assetsmanaged by women fundmanagers, 80% of the AUMoutperformed the bench-mark/ peer group averageover 1 year basis, 71% over3 year basis and 72% over 5year basis. This as demon-strated the capability of thewomen to drive consistentperformance through mul-tiple market cycles and re-main in the top quadrant,”states the report.
Some top women fundmanagers include SwatiKulkarni (UTI Mutual Fund)and Lakshmi Iyer (KotakMahindra AMC).
Reliance Cap to spin off healthbusiness from general insurance
New Delhi,Reliance Capital will set up a stand-alone health
insurance company by carving it out from the generalinsurance entity. The board of directors of RelianceGeneral Insurance Company (RGIL), a subsidiary ofReliance Capital, has approved the proposal to sepa-rate the health segment. Sector regulator InsuranceRegulatory and development Authority of India (Irdai)is yet to approve the plan.
Reliance Health Insurance, the proposed new com-pany, will be a wholly owned subsidiary of RelianceCapital a company statement said.
Health insurance business, one of the fastest grow-ing in India, is estimated to double to about Rs 50,000crore ($8 billion) by 2020. RGIL’s health insurance port-folio recorded gross premium of Rs 570 crore ($87 mil-lion) as of March 31, 2016. Reliance Capital said theproposal to separate health business will enhancemanagement focus on this segment.
It will provide flexibility to the company to unlockvalue by bringing in global leaders in this space as stra-tegic and equity partners, it added.
Roadmap to ease FDI approvalprocess in few weeks: Das
New Delhi,The government will
come out with a roadmap inthe next few weeks to fur-ther simplify the foreign di-rect investment (FDI) ap-proval process by abolish-ing the Foreign InvestmentPromotion Board (FIPB),Economic Affairs SecretaryShaktikanta Das said.
The necessary formalproposals will be consid-ered by the governmentvery shortly, he said at anevent in New Delhi. The pro-cedure which will be fol-lowed after dismantlingFIPB will be announced, it'sa matter of few weeks, Dasadded.
The online interface forFDI approval that is the por-tal of FIPB will continue forgreater transparency andspeed, he said.
The government hadconstituted a group of offic-ers from Department ofEconomic Affairs, Depart-ment of Industrial Policyand Promotion (DIPP), Ex-ternal Affairs and represen-tatives from regulators likethe RBI and SEBI. The grouphas finalized the modalitiesfor successor arrangementpost abolition of FIPB.
Finance Minister ArunJaitley in the Budget speechlast month had announcedthe abolition of FIPB andsetting up of a new mecha-nism that could include ap-provals by the ministriesconcerned for expeditiousclearance of foreign invest-ment proposals.
We have now reached astage where FIPB can bephased out. We have there-fore decided to abolish theFIPB in financial year 2017-
18. A roadmap for the samewill be announced in thenext few months. In themeantime, further liberal-ization of FDI policy is underconsideration and neces-sary announcements will bemade in due course, he hadsaid. Terming India as one ofthe most open countries inthe world in terms of FDI in-flows, Das said the govern-ment is committed to pro-vide an overall macroeco-nomic and fiscal environ-ment which is prudent andstrong. India has witnesseda 38 percent surge in for-eign capital inflows duringthe first half of financial year2016-17 when world overFDI flows declined 5 per-cent, he said. In the comingyear, one expects a lot of in-vestments to come into In-dia from both domestic andforeign sources, he added.
In the coming year, hesaid, one expects a lot of in-vestments to come into In-dia from both domestic andforeign sources.
Vodafone yet to seek finalRBI nod for payments bank
Mumbai,Vodafone m-pesa Ltd.,
one of the 11 entities whichreceived in-principle ap-proval from the ReserveBank of India in 2015 to starta payments bank, has notyet applied for a final li-cence. Top central banksources confirmed thatVodafone m-pesa had notyet applied for the final li-cence. Even if it did applynow, it is unlikely that it willreceive the final approval inthe next ten days. RBI typi-cally take at least twomonths to grant its final ap-proval.
Vodafone India did notcomment on the issue. Allentities that receive in-prin-ciple approval require to se-cure final approval from theRBI, after meeting normsmandated by the bankingregulator, within 18 monthson receiving the inprinciplenod. The 18 month deadlinewhich starts from the date
these entries receive lettersof in-principle approvalfrom the RBI, which was inSeptember 2015- ends inMarch. Among the 11 enti-ties that had received inprinciple approval, the Re-serve Bank of India grantedfinal approval to four. Theyare Vijay Shekhar Sharma ofone 97 Communications,which owns mobile walletPaytm, Airtel M Commerce,Department of Posts andMukesh Ambani’s RelianceIndustries.
Three more entities FinoPaytech, National SecuritiesDepository Limited andAditya Birla Nuvo are ex-pected to receive the finalapproval soon. Three of the1 entities - Cholamandalam,Dilip Shanghvi, MD of SunPharma and Tech Mahindrahave dropped their plans.While the reason forVodafone to, presumably,not pursue its paymentsbank venture in India is not
clear industry sources saidstricter RBI norms could beone of the reasons.
This is despite its Kenyamodel being cited as one ofthe successful mobile walletmodels in the world.
RBI has mandated thatthe promoters of the pay-ments banks should hold atleast forty per cent of itspaid up equity capital forthe first five years from thecommencement of its busi-ness. The norms also said atall times at least 26% of thepaid up capital will have tobe held by residents.Vodafone India is a whollyowned subsidiary ofVodafone Plc - a British firm.Interestingly, Vodafone’s In-dia business and Idea Cellu-lar have announced theirmerger to create the big-gest telecom player in theIndia. Aditya Birla Nuvo, pro-moted by the Aditya BirlaGroup had also receivedinprinciple approval.