READ TO LEAD

THEASSOCIATED PRESSGeneva, June 2

THROUGHOUTJANUARY,THEWorld Health OrganizationpubliclypraisedChina forwhatit called a speedy response toCovid and thanked Beijing forsharing the geneticmapof thevirus“immediately”.Butinfact,Chineseofficialssatonreleasingthegeneticmap,orgenome,ofthedeadlyvirus foroveraweekaftermultiplegovernment labshadfullydecodedit,notsharing

details key to designing tests,drugsandvaccines.

Strict controls on informa-tionandcompetitionwithintheChinese public health systemwere largelytoblame,TheAsso-ciated Press has found frominternaldocuments,emailsandinterviews.HealthofficialsonlyreleasedthegenomeafteraChi-nese lab published it ahead ofauthoritiesonavirologywebsiteonJanuary11.

ContinuedonPage2

FE BUREAUNewDelhi, June 2

PRIMEMINISTER NARENDRAModionTuesdayexpressedhisstrong resolve to regain theeconomy’sgrowthmomentumand asked for industry inputsfor‘morestructuralreforms’hisgovernment is determined toundertake,initsefforttofacili-tate the country’s ‘growth-ori-ented,big take-off’.“Forus themeaningofreformsisthebold-ness to take decisions andper-sist with them till the logicalend,”Modi said,addressing theConfederationofIndianIndus-try’s 125th annual session,viavideoconference.

Listing out the steps takenby his governments over theyears like the insolvency code,GSTand bankmergers to bol-ster the economy’s productivecapacity and the reformmea-suresannouncedrecentlyintheareas of agriculture producemarketing and coal mining,

Modi said these long-pendingreformswere among the onesthe country appeared to haveabandoneddue to their appar-ent intractability. The primeminister asserted:“Yes,wewilldefinitelygetourgrowthback…Indiawillget itsgrowthback”.

Modi, accused by manyanalystsofbeingcontentwithincrementalism in hisapproach to reforms duringthe tenure of his first govern-ment,hasclearlychangedtack.

ContinuedonPage2

FUTURE-READY GLOBALTO LOCAL

FE BUREAUNewDelhi, June 2

THEGOVERNMENTONTues-day started inviting applica-tions for the `40,995-croreproduction linked incentive(PLI) schemes to attract globalmobile device makers andboostlocalcompaniesforelec-tronicsmanufacturing.Firmscan apply till July 31 and theselected companies will beannouncedbyearlyAugust.

Telecom and IT ministerRaviShankarPrasadsaidIndiawill initially aim to attract topfive global mobile manufac-turing companies and alsopromote five local firms thatwill be identified through ascreening process.“There are5-6 large companies that con-trol 80%of the globalmobilemarket. Initially,wewill pickup five global championswhounder the PLI scheme shall bepermitted toparticipate.

“Global and the local will

together make India a goodmanufacturing talented coun-try,supportingtheglobalchain.WewillalsopromotefiveIndiancompanies tobecomenationalchampions,”Prasadsaid.

Thepolicybroadlyhasthreeobjectives: Attract global leadfirms andvalue chains such asApple,Samsung,OppoandVivotostartmanufacturingmobilephones for exports; buildIndian champions for globalexports such as Lava, Micro-max, Intex,and Karbonn; andattract investments in selectelectroniccomponentssuchas

semiconductor devices, tran-sistors,PCBs,sensors,SIP,etc.

Under the new policy,whichwas notified inApril, aproduction-linked incentiveschemereplacestheMerchan-dise Exports from IndiaScheme (MEIS), which waschallenged at the WTO inMarch2018anddeclaredvoidin October 2019. The newscheme is WTO-compliant,since it targets production ofphoneswhosemanufacturingvalue is$200orabove.

ContinuedonPage2

PRABHUDATTAMISHRANewDelhi, June 2

THE CORRELATION BET-WEEN the government-setminimum support prices(MSPs) and the production ofcropshas continued tobe ten-uous if not absent, even aftertheNDAgovernment adoptedthe policy of fixing MSPs at150%ofthefullpaid-upcosts(A2+FL) in the run-up to the2018 general elections.As thetableshows,thereisbarelyanydiscernible link between the

two, and in many cases, evenbig drops in crop output fol-lowedsteepMSPhikes.

Moreover, the buttressed

MSPpolicymaypotentiallyhitthe country’s crop diversifica-tionprogramme.Thepolicyofprocuringmost of the impor-

tant crops atMSPs or provid-ingpricesupporttofarmersbycash transfers, employed bytheCentreandsomestates,are

potentiallyveryexpensive.Thecostsareremainingwithincer-tain limits because in actualpractice,onlypaddyandwheatfarmers getMSPbenefits in ameaningfulmanner.

IfsharperincreasesinMSPscontinue for longer periodsand the procurement/pricesupport measures are dulyimplemented, then thesemight start impacting farm-ers’ cultivation preferencesovertime,analysts said.

ThegovernmentonMondayfixed the MSPs of 10 kharif

2020 crops at 50% over theircosts of production while thesupport prices for fourwere setat53-83%overthecosts.

An analysis by FE of 20kharifandrabicropsforwhichMSPs are announced beforethe start of sowing season hasrevealedthat,ragiproduction,for instance, dropped 38% in2018-19 crop year (July-June)even though itsMSPhad seenthehighestincreaseof52%(y-o-y) among14kharif crops.

ContinuedonPage2

BLUNT TOOL?

KRISHNKAUSHIK &SHUBHAJITROYNewDelhi, June 2

STEPPINGUPEFFORTS tode-escalate thesituationalong theLineofActualControlinLadakh,IndiaandChinawillstartafreshroundofmilitary talks on June6, bringing their senior com-manderstothetable.

Armysourcesindicatedthiseven as defenceminister Raj-nath Singh told CNNNews18that he had been informedabout the talks, and that theChinese presence on thegroundis“achhikhasisankhya”(sizeable numbers).“In today’ssituation, military talks aregoing on,and possiblyon June6, talks are going to happen atthe levelof seniormilitaryoffi-cers.I spoke to the (Army) chiefandotherstoday,andtheyhaveinformedme,”Singhsaid.

On the build-up of troops,Singhsaidtheproblemhasrisenbecause of the different LACclaimsofthetwosides.“Thecur-rent situation, it is true, thattheir claim is up to aparticularpoint and India’s claim is to aparticularpoint.Andduetothat,there is disagreement.Chinesepeople have come in sizeablenumbers.Butwhateverneedstobedone,Indiahasalsodone.”

ContinuedonPage2

● BORDER TENSION

LAC talks ontwin tracks:India-Chinaand India-US

PRESSTRUSTOF INDIANewDelhi, June 2

THEAVERAGE POWER tariffin the real-timemarket tradeat the India Energy Exchange(IEX) on the first dayof opera-tiononMondaystoodat`1.55perunit,42%cheaperthantheday aheadmarket, the officialdata showed.

Real-time market (RTM)enables consumers, includingdistribution companies (dis-coms)andcaptiveusers,tobuypower on exchanges just anhourbeforedelivery.

The average price discov-eredondayonewas`1.55perunit,theauctionssawthepricego as lowas `0.10 per unit onthe platform, the IEX said in astatement. According to theIEX data, the average price ofpowerinthedayaheadmarket(DAM) trade on May 31 fordelivery on June 1,was `2.68perunit.Similarly,theaveragetariffofpoweratDAMtradeonJune 1 for delivery on June 2was`2.2perunit.

The newmarket segmentwasoperationalisedat the IEXplatform at 10:45 PMonMay31,2020,fordeliveryat12:00AM on June 01 (Sundaymid-night),2020.

The real-time markettraded3.41MU (millionunitsvolume in48auction sessionsondayoneof the launch.

● FIRST DAY AT IEX

Power tariffcheaper by42%on avg inreal-time trade

China delayed releasingvirusinformation, frustratingWHO

IN THE NEWS

HC seeks govt,Trairesponse on Paytmphishing claimsTHEDELHI HIGHCourt onTuesday sought responsefrom theCentre and telecomregulatorTrai on Paytm'splea alleging that telecomoperators are not blockingthosewho are defrauding itscustomers by "phishing"activities overvariousmobilenetworks, reportsPTI.TheHC issued notices to theministry of communication,Trai andmajormobileservice providers, includingAirtel, Reliance Jio, MTNL,BSNLandVodafone, seekingtheir standon thepleabefore the next date ofhearing on June 24.

AirAsia India cutspilots' salaries by40% forMay, JuneAIRASIA INDIAHAS slashedsalary of its pilots by anaverage 40% for May andJune, an airline source said,reports PTI. However, thequantum of reduction inpay for other categoriesand seniormanagementremains at theApril level,he said. The senior manage-ment of the airline had takena pay cut of 20% inApril.Responding to a PTIquery on the issue, anAirAsia India spokespersonsaid, "We do not commenton the internal matterspertaining to the company."

Five global and fivelocal firms to beselected for benefits

COVID-19

RURALRELIEF

SURYASARATHI RAYNewDelhi, June 2

THE MAHATMA GANDHINational Rural EmploymentGuaranteeScheme(MGNREGS)producedanaverageof18croreperson days of work in April-May period of this fiscal, asagainst 22.1 crore/month in2019-20, government datashowed. This indicates thatdespite the lockdown,theCen-tre’sacceleratedreleaseoffundsunder thepopular jobs schemeand the support provided bymost states ensured that theschemeindeedprovidedtimelyrelieftotheruralpoor.

Apparently, there was asudden surge in MGNREGSjobssincethefirstweekofMay.While only 9.15 crore persondays were created betweenApril1andMay10,duringthenext 20 days,27 crore persondays were created under thescheme. The easing of lock-down started from secondweekofMay.

To ensure that crores ofmigrant labourers who havegoneback to theirvillages findenough job opportunities, thegovernment has allocated anadditional`40,000croreundertheMGNREGS for the currentfiscal,overand above`61,500croreallocatedintheBudgetfor2020-21. Announcing this,finance minister NirmalaSitharamansaidwith the infu-

sion, nearly 300 crore persondaysof jobscanbegeneratedin2020-21, a larger number ofdurable and livelihood assetscan be created. In 2019-20, atotal 265.34 crore persondaysofworkhadbeencreatedunderthescheme,whilethefigurewas268croreintheyearbefore.

TheCentrereleased`21,753crore or 35% of the originalannualbudgetoutlayundertheschemeinthefirst40daysofthecurrent financial year, as itsought to use the popularscheme toalleviate thedistressofmigrantworkersreturningtotheirvillagesinlargenumbers.

ContinuedonPage2

Modi’s assertionfollowsGDPslowingto a 44-quarter lowof 3.1% inQ4FY20,rating downgradebyMoody’s

QuickPicks

Moody’s downgrades Infosys,TCS,SBI,HDFC Bank,others

MOODY’S DOWNGRADED issuer ratings of eightbig companies and four banks,which includeTCS, Infosys, ONGC, SBI, HDFCBank, Exim Bankand IndusInd Bank, reports fe Bureau inMumbai.

The global rating agency has cited economic disruptioncaused byCovid-19 and sovereign downgrade as the reasonfor ratings review.While the rating agency has affirmed thelong-term rating ofReliance Industries, it has revisedcompany's outlook to ‘negative’ from ‘stable’. PAGE 10

Gilead Sciences getsmarketingauthorisation for remdesivir

ANTI-VIRALDRUG remdesivir has been approvedfor "restricted emergency use" on severe Covid-19 patients, the Union healthministry said onTuesday, reports PTI. OnMonday, India's drug

regulator grantedUS pharma giant Gilead Sciences themarketing authorisation for its drug remdesivir for "restrict-ed emergency use" on hospitalised patients, sources said.The approval processwas accelerated in viewof theemergency situation and the unmet need formedicines.

Modi,Trump hold talks onSino-India ties,Covid-19

PRIMEMINISTERNarendraModi andUSPresidentDonaldTrumponTuesdaydiscussedvariousissues, including the situationon the India-Chinaborder, Covid-19 andneed for reforms in the

WHO, anofficial statement said, reports PTI. During thetelephonic conversation,Trump invitedModi to attend thenextG-7 summit tobeheld in theUS.Modi expressedconcernover the "ongoingcivil disturbances in theUS", andconveyedhis bestwishes for an early resolutionof the situation.

COMPANIES, P4

MARCHQUARTER DIVE

INTERNATIONAL, P8

SENSEX: 33,825.53 ▲ 522.01 NIFTY: 9,979.10 ▲ 152.95 NIKKEI 225: 22,325.61 ▲ 263.22 HANG SENG: 23,995.94 ▲ 263.42 `/$: 75.36 ▲ 0.19 `/€: 84.13 ▼ 0.03 BRENT: $39.19 ▲ $0.87 GOLD FUTURE: `46,950 ▼ `133

AHMEDABAD, WEDNESDAY, JUNE 3, 2020

IndiGo reports netloss of `870 cr, looksto shore up cash

GEORGE FLOYD PROTESTS

Violence sweeps US againafterTrump threatensmilitary force

OPINION, P6

RENU KOHLI EDITORIAL

Without urgentdemand stimulus,economywon’t recover

Centre's conditions for

extra borrowing room

for states aren't unfair,

will benefit the latter

VOLUME XIV-310, 14 PAGES, `6.00 PUBL I SHED FROM : AHMEDABAD, B ENGALURU , CHAND IGARH , CHENNA I , HYDERABAD, KOCH I , KOLKATA , LUCKNOW, MUMBA I , N EW DELH I , PUNE

FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM

READ TO LEAD

ABANTIKAGHOSHNewDelhi, June 2

ASTHETOTALCovid-19case countnears the2-lakh mark, Indian Council of MedicalResearch (ICMR) scientistDrNiveditaGuptasaidonTuesdaythatthecountryisstill“veryfarawayfromthepeak”.Inaninfectiousdisease,apeaksignifiesthepointatwhichthedailycase

countwill start to fall.Over the last fewdays,over8,000newcaseshavebeenreportedfromacross thecountrydaily.“Weareveryfarawayfromthepeak.Ourpreventivemeasureshavebeenvery effective.We are in amuch betterpositionvis-a-visothercountries andyouwillseethedatasoon,”DrGuptasaid.

ContinuedonPage2

FD PPFEPF

&

VPF

Bharat

Bond

ETF

Tax-free

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`

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Withbanksslashing fixeddeposit rates, risk-averseinvestorshave to look foralternativedebtproducts likepostofficeFDs,PPF,EPF/VPFandBharatBondETFs toearnhigherpost-tax returns■Personal Finance, P9

ProjectStepOne,a jointinitiativeof21startups,powersstatehelplinenumbersthroughascalablenetworkofexistingcloudtelephony,queuingsystemsandanetworkofdoctorsoncall■eFE, P9

Fixed income:Opt for longertenure forhigherreturns

Project StepOne: Fighting theviruswith techand teamwork

No co-relation between MSP & production of cropsCrop year (Jul-Jun) MSP Production % change (y-o-y)

0

4

8

12

16

2016-17 2019-20 2016-17 2019-20 2016-17 2019-20-40

0

40

80

-20

0

20

40

4.3

5.13.7

1.33.5

7.4

69.5

4.9 1.6

8.6

28.6

2

RICE JOWAR COTTON

BolsteredMSPpolicy has little bearing on crop output

Average jobs*/day(lakh)

2018-19

74.4

73.6

22.8

135.5

2019-20

April 1-May 10, 2020

*Person days of work

May 11-31, 2020

PMSPEAK

Coronamayhaveslowedourspeed(ofgrowth)but Indiahasnowmovedaheadfromlockdownwiththephaseoneofunlock.UnlockPhase-1hasreopeneda largepartoftheeconomy

Labour reformstoimprove jobopportunities

Morestructural reforms(willbeundertaken) tochangethecourseofthecountry

Will get growth back,reforms on track: PM

Big job surge inpast threeweeks

Salon staffgive haircuts to customers in PPE suits and facemasks atWest Patel Nagar inNewDelhi onTuesday

Forus, reformsarenotanyrandomorscattereddecisions,butasystemic,planned, integrated,inter-connectedandfuturisticprocess

`8,20,375 crIncremental productionover 5 years

`5,85,094crIncrementalexportsover5years

`52,178crNet exportsover 5 years

2,00,000 jobsAdditional employmentgenerationover 5 years

WHAT’STHEAIM

`4,782 crDirect tax revenueover5years

Applications invitedundernewmobilemanufacturingpolicy

SUNILJAINNewDelhi, June 2

AT JUST UNDER four milliontests so far—2,708permillionpopulationversus51,168intheUS—India’stestingisquitelow,butiftheDelhigovernmenthasitsway, thismay fall even fur-ther.Ithascalledseveralprivatetesting laboratories and toldthemthattheyneedtopullbackontheirtestinglevels.

Instead of testing anyonewhowants to get a test—pro-vided theyhave a doctor’s pre-scription,asperthe rules—theDelhi government has toldtheselaboratoriesthattheycan-not be testing asymptomaticpersons.Howprivate laborato-riesaretocomplywiththisisnotclearsincealaboratory’sjobistotest,not to determinewhetherthepatientneedstohaveatest.

It isnot clearwhytheDelhigovernment should come upwith such a stipulation since,at 10,772 tests per millionpopulation— versus15,432inMumbai and 60,000 in NewYork state—Delhi’s testing isquite inadequate.

ContinuedonPage2

Case count nears 2-lakhmark, ICMR says ‘far away frompeak'

TASHITOBGYAL

Delhi govt tells private labsto restrict level of testing

Ahmedabad

EconomyWEDNESDAY, JUNE 3, 2020

FINANCIALEXPRESS2

●DIALYSIS FACILITYMANAGEMENT

ISHAAN GERANew Delhi, June 2

WHILE THE MAHARASHTRAgovernmentisstrugglingwithgetting enough hospital bedsreadyforCovid-19patients inMumbai, it seems to haveturned a corner on dialysisfacility management. Thestate government,partneringthe Mumbai NephrologyGroup, an association of kid-ney specialists, and IIT Bom-bay, has come up with a livedashboard for linking Covid-19 positive/suspect patientsneedingdialysiswithavailabledialysisunitsatfacilitiesserv-ing suchpatients.

Once a Covid-19patient/suspect requiringdialysis is registered in thesystem, the administrationcan use the dashboard todirect the person to a facilitythat has a unit free for use inCovid -19 cases.Mumbai, atpresent, has registered 373such patients, of which 332have been assigned slots asavailable on the dashboard.

“Wehavereducedthetimeconsumed for a Covid-19patient requiring dialysisfindinga facility.Patientsandtheir families no longer areleft to fend for themselves,”says a facultymember of theIITBombay team that helped

set up the dashboard, whowishes to remain unnamed.

“We are adding morefunctionalities.Withinhospi-tals, there is a subset of thosethat can provide dialysis carealong with beds for Covidpatients.So,thedatabasewillhelp dialysis patients findbeds. We will also integratethe system for ICU bed avail-ability for dialysis patient at

some point in time,” he fur-ther added.

They are also looking toadd ambulances that cater todialysis patients so thattransportation does notbecome a challenge.

On May 5, the MunicipalCorporationofGreaterMum-bai had issued a directive toall dialysis centres not torefuse services to dialysispatients, and not to insist forCovid testing for patientsrequiringdialysis.OnMay13,33 dialysis machines weremade functional in 3 hospi-tals. This count increased to92 on May 26. Mumbai,according to theMay 31 bul-

letin,has168registereddial-ysis facilities,ofwhich17 arehandling Covid-19 patientsand twoarehandling suspectcases-- these facilities have105 machines serving thispatient subset. At present,1.8%ofactiveCovid-19casesinMumbai require dialysis.

Sources say that Mumbaihas engaged services of an ITfirm to create a facilityman-agement system for all itsCovid hospitals. Last month,ICMRhad announced a part-nership with IBM for theirartificial intelligence plat-formWatson to aid laborato-ries in filing and cataloguingof data.

Telcos not preventingphishing: Paytm in HCTHE DELHI HIGH CourtTuesday sought response ofthe Centre and telecomregulator Trai on onlinepayment platform Paytm'splea alleging that telecomoperators are not blockingthose who are defraudingits customers by ‘phishing’activities over variousmobile networks.

A bench of Chief JusticeD N Patel and JusticePrateek Jalan issued noticeto the Ministry ofCommunication, TelecomRegulatory Authority ofIndia and major mobileservice providers, includingAirtel, Reliance Jio, MTNL,BSNL and Vodafone seeking

their stand on the pleabefore the next date ofhearing on June 24.

Additional SolicitorGeneral Maninder Acharyaand central governmentstanding counsel AnuragAhluwalia accepted noticeon behalf of the ministry.

—PTI

From the Front Page

Applicationsinvited undernewmobilemanufacturingpolicyCompanies will require tomeetincrementalinvestmentsand produce incrementalphones over and above FY20(whichhasbeendefinedasthebase year). Investment andproduction targets increaseover a three-year period andfive-yearperiod,respectively.

The schemewill extendanincentive of 4% to 6% onincremental sales over baseyear of goods manufacturedin India and covered undertarget segments, to eligiblecompanies,foraperiodof fiveyears subsequent to the baseyear as defined. Due to this,the domestic value additionformobilephones isexpectedto rise to 35% to 40% by2025fromthecurrent levelof2%-25%.

According to industry esti-mates,mobilemanufacturingcompanies have the potentialto get an incentive of around`7,500 crore if they scale upproduction to about`1.5 lakhcrore over the next five yearsunderthePLI scheme.

The production of mobilehandsets in 2018-19 hadreached 29 crore units worth`1.70 lakh crore from 6 croreunits worth `19,000 crore in2014. While the exports ofelectronicshasincreasedfrom`38,263 crore in 2014-15 to`61,908 crore in 2018-19,India's share in global elec-tronics production hasreached 3% in 2018 from1.3%in2012.

Rural relief: Bigjob surge inpast threeweeksThe average daily release offunds under the scheme tillJune1 in the current financialyear was `439 crore, against`196 crore in 2019-20 and`170crore in2018-19.

According to the ruraldevelopmentministry, a totalof 38.6 crore person days ofworkhave been createdunderMGNRGEStillJune1.OnMon-day, 2.73 crore workers werethere in the field working on1.65 lakhworksites. Commu-nity-basedwork could not becarried out in full volume formost of April andMay due tolockdowninmanypartsof thecountry.

The average dailywage perpersonundertheschemeinthecurrentfiscalhasbeen`201.29,comparedwith`182 in2019-20,indicating thatwages haveindeed been increased. TheMGNREGS funds released bytheCentre so far in the currentfinancialyearincludesarrearsofthelastfiscal.

The Centre had released`71,248 crore under MGN-REGS in 2019-20 and`61,125crorein2018-19.Therevised estimate for thescheme invariably tends to belarger than the Budget Esti-matesmade at the start of theyear, inwhat shows the popu-larity of the Scheme,which ismuch in demand among theruralpoor.

The National RuralEmployment Guarantee Actwas notified on September 7,2005. It provides for a mini-

mum of 100 days of wageemploymentinafinancialyeartoeveryruralhouseholdwhoseadultmembervolunteerstodounskilled manual work. Anadditional 50 days of wageemploymentareprovidedoverandabove100daysinthenoti-fied drought affected areas ornatural calamity areas and toevery Scheduled Tribe house-hold ina forest area.

Covid-19:Delhi govt tellsprivate labs torestrict level oftestingMore so, since every 100 newtestsinthecapitalthrowup22new infected persons – basedonthedataontestssubmittedbytheDelhigovernmenttotheDelhi high court – youwouldassume Delhi would want toramp up testing dramatically.Indeed,the‘positivity’levels –new infections for every 100newtests–forIndiahaverisenfrom 3.4 at the end of Lock-down2 to 5.2 today,and from6.9 to10.4 forDelhi (basedonthe data in the capital’s dailymedical bulletin). In any case,since these tests are not paidforbythegovernment,thenewrulemakes little sense; all thatrestricted testing does is toensure that lower infectionlevels are reported.

It also poses a problem forthecapital’scitizens.Ifcitizensareworriedtheymayhavecon-tacted the disease – whilegoing to theofficeorto amar-ket – they cannot just go andget a test done. They have todevelop symptoms likea feverfirst and then find a doctorwho is willing to certify thatthis is a fit case fora test;mostdoctors,though,wouldrecom-mendwaiting for aweek or sobeforeprescribinga test.

Ortake thecaseofapersonwants to go to a hospital for aprocedure; unless the personexhibits Covid symptoms,notest can be carried out; andwithout the test, the hospitalwillnotdoaprocedure.Evenifa parent has contracted thedisease, a test cannot be doneforanasymptomaticchild;theonlyoptionisafriendlydoctorwilling towrite aprescription,after which a private labora-torywill do the test.

Intheearlydaysofthepan-demic,whenkitswere inshortsupply, the guideline stillmade sense, but there is nosuch shortage now, and kitsare evenmade locally. In anycase,if thegovernment–bothinDelhi and at the Centre – isserious about arresting thespread of the infection, itshouldbeinterestedintestingasymptomatic persons.Afterall,someweeks ago,the ICMRhad said that around70-80%of the infectedwereasympto-matic; given this, restrictingtesting to the symptomaticmakes little sense.

China delayedreleasing virusinformation,frustratingWHOEven then,China stalled for atleasttwoweeksmoreongivingWHO the details it needed,according to recordings ofmultiple internal meetingsheld by the UN health agency

inJanuary—allatatimewhenthe outbreak arguablymighthave been dramaticallyslowed.

AlthoughWHO continuedto publicly commend China,therecordingsobtainedbytheAP show theywere concernedChinawasnotsharingenoughinformation to assess the riskposedbythenewvirus,costingtheworldvaluable time.

“We're currently at thestagewhereyes,they're givingit to us 15 minutes before itappears on CCTV,”saidWHO'stop official in China,Dr Gau-den Galea, referring to thestate-owned China CentralTelevision,inonemeeting.

The story behind the earlyresponse to the pandemiccomes at a timewhen the UNhealth agency is under siege.US President Trump cut tieswith WHO on Friday, afterblasting the agency forallegedly colluding withChinatohidetheextentof theepidemic.

Chinese President Xi Jin-pingsaidChinahasalwayspro-videdinformationtoWHOand

the world “in a most timelyfashion”.Thenewinformationdoesnotsupportthenarrativeof either the US or China, butportrays an agencynow stuckinthemiddlethatwasurgentlytrying to solicitmoredata.

Althoughinternationallawobliges countries to reportinformation to WHO thatcould have an impact on pub-lic health, the UN agency hasno enforcement powers.Instead, it must rely on thecooperationofmemberstates.

The AP has found ratherthan colluding with China,WHOwas itself largelykept inthe dark, as China gave it onlythe minimal informationrequired. But the agency didattempttoportrayChinainthebest light,most likely to coaxthe country into providingmoreoutbreakdetails.

WHO officials worriedabout how to press China formore information withoutangeringauthoritiesorjeopar-dising Chinese scientists,whom theypraised for decod-ingthegenomewithastonish-ingspeed.

Dr Michael Ryan, WHO'semergencies chief, said thebestwayto“protectChina”wasforWHO to do its own inde-pendentanalysis,becauseoth-erwise the spread of the virusbetween people would be inquestion and“other countrieswill takeactionaccordingly”.

Fromthetimetheviruswasfirst decoded on January 2 towhenWHO declared a globalemergency on January30, theoutbreak grew by a factor of100to200times,accordingtoretrospective Chinese Centerfor Disease Control and Pre-ventiondata.

WHO and officials namedinthisstorydeclinedtoanswerquestions asked by the APwithoutaudioorwrittentran-scripts of the recordedmeet-ings,which theAPwas unabletosupplytoprotectitssources.

“Our leadership and staffhaveworkednightandday….tosupportandshareinformationwith all Member Statesequally, and engage in frankand forthright conversationswithgovernmentsatall levels,”aWHOstatement said.

China's National HealthCommission andMinistry ofForeign Affairs had no com-ment. But in the past fewmonths,China has repeatedlydefendeditsactions,andmanyother countries — includingthe US — have responded tothe virus with even longerdelays of weeks and evenmonths.

In late December, doctorsnoticedmysterious clusters ofpatients with unusual pneu-monia. Seeking answers, theysent samples to commerciallabs. By December 27, onecompany,VisionMedicals,hadpieced together most of thegenome of a new virus withstriking similarities to SARS.They alertedWuhan officials,who,dayslater,issuedinternalnoticeswarningoftheunusualpneumonia.

On December 30, ShiZhengli, a renowned coron-avirus expert at the WuhanInstitute of Virology, wasalerted to the disease, and byJanuary 2,her team had fullydecoded it.

Butwhenitcametosharing

the genome with the world,thingswent awry.China's topmedical authority, theNational Health Commission,issued a confidential noticeforbidding labs frompublish-ing about the virus withoutauthorisation. The orderbarred Shi's lab from publish-ingthesequenceorwarningofthepossibledanger.

Commission officials latersaid the orderwas to preventany accidental release of thethen-unknownpathogen,andtoensureconsistentresultsbygiving it to four state labs toidentifyat the sametime.

ByJanuary5,twoothergov-ernment labs sequenced thevirus, and another lab inShanghai led by ZhangYongzhenhadalsodecoded it.Zhang warned the NationalHealth Commission the viruswas“likelyinfectious”.TheChi-neseCDCraiseditsemergencyleveltothesecondhighest,butdid not have the authority toalert thepublic.

Case countnears 2-lakhmark, ICMRsays ‘far awayfrompeak'This is in line with severalstatements by topgovernment officials,including from NITI Aayogand AIIMS, that the worstmonths are likely to be Juneand July.

With 8,171 new cases and204 deaths being reported inthe last 24 hours, the totalcase count is now 1,98,706,including 5,598 deaths and95,526 cured/ discharged.

Whether there is a singlepeak,multiple ones,orwaves,experts say that when aninfectious disease hits a peak,itmaynotmean the outbreakis over but it usually meansthat the worst is over.However, there could beanother wave or peak later.With Covid-19 being a newpandemic, nobody knowshow it will pan out.

On the issue ofcommunity transmission, DrGupta said: “In an infectiousdisease... the important thingis the extent of the spread.Instead of using the wordcommunity transmission, itis important to understandthe spread and where westand vis-a-vis othercountries. To that end, ICMRhas started a sero-surveyunder which close to 34,000people will be covered. Theresults will be in publicdomain by the end of theweek.”

This comes days afterthree medical organisations,represented by experts fromAIIMS and ICMR’s ownresearch groups, saidcommunity transmission hasset in.According to the healthministry's analysis, of thetotal deaths so far, 50%wereaged over 60 years, and 73%had co-morbidities.

This is the first time thatICMR was represented by DrGupta at the briefing.BothDrBalram Bhargava, ICMR DG,and Dr R R Gangakhedkar,head of epidemiology andinfectious diseases, are inself-quarantine followingcontact with a positive caselast week.

Health Ministry JointSecretary Lav Agarwalconfirmed that states have

been asked to requisition allpossible places which can beconverted into facilitieswhere patients can behoused.

“Covid is known to affectoxygen saturation levels.However, our experience hasbeen that very few patientsneed ventilator or ICUsupport, so states have beenasked to concentrate onmoreoxygen beds,” he said.

Till May 30, there were942 dedicated Covidhospitals with 1,58,908isolation beds, 20,608 ICUbeds and 69,384 oxygen-supported beds; 2,380dedicated Covid healthcentres with 1,33,678isolation beds, 10,916 ICUbeds and 45,750 oxygen-supported beds; 7,304 Covidcare centres with 6,64,330beds; and 10,541 quarantinecentres.

Agarwal said approval foruse of remdesivir in case ofemergency has been given asper established procedures.On India being rankedalongside other countries interms of its Covid-19numbers, he said: “It is not afair comparison to saywe arein such and such position.You have to take into accountthe population of thosecountries and ourpopulation.”

Meanwhile, the healthministry has shot a videofeaturing actor AkshayKumar in an attempt toaddress the public fear overCovid-19.

LAC talks ontwin tracks:India-Chinaand India-USSingh said India and China“have a mechanism to solvethe problem andwe arework-ing as per that mechanism…What can be better if it can beresolved through talks… Beassured.”

Meanwhile, diplomaticsources pointed to anotherdevelopmentovertheLACten-sions: India and the US arelikelytoestablisha“high-levelcontact soon".

This, sources said, could bein the form a phone callbetween Prime MinisterNarendraModi and US Presi-dentDonaldTrump.

Or, it could take placebetweenExternalAffairsMin-ister S Jaishankar and US Sec-retaryofStateMichaelRPom-peo. Last week, DefenceMinister Rajnath Singh spoketo US Secretary of DefenseMarkEsper.

The new India-US conver-sation, sources said, could beon the strained relationswithChina, the Covid-19 situationandtheproposedexpansionoftheG7.

Meanwhile, the militarytalks between the Indian andChinese forces are to be raisedtothelevelofLtGenerals,likelytheCorpsCommanders.

Until now,talks have takenplaceatthelevelofthebrigadecommander,but therehasnotbeenmuchheadway.

Sources said raising thelevel of talks could be an indi-cation of both sides “agreeingto disengage”. The brigadecommanderleveltalks,sourcessaid,werehappeningonareg-ularbasis,“exceptfortheinitialdayswhen things had startedheatingup.”TalkswereheldonMondayaswell.

Local contentin publicprocurementTHEMINISTRYOFChemicalsandFertilisersonTuesdayfixedtheminimumpercentageoflocalcontentinpublicprocurementof55chemicalandpesticideproductsaspartofthegovernment'sefforttoboostdomesticmanufacturingandtheMake-in-Indiaprogramme.

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RISKMANAGEMENTRajnish Kumar, chairman, SBI

I hear a lot about risk aversion, but thedividing linebetweenrisk aversion and risk prudence isvery thin.Onequestionwhich I havebeen asking is -- is there risk aversiononlyamong lenders or there is risk aversion amongborrowersalso.Are theywilling to leverage?Are theywilling to invest?

State partnersnephrologists’ body, IIT tocreate a dashboard to linkdialysis demand inMumbaiwith facilities offering it

Will get growth back, reforms on track: PMIn the backdrop of the eco-nomicexpansionratehavingplunged to a 11-year low of4.2% in 2019-20, and eventhe RBI prognosticating thegrowth to be in the negativeterritoryinthecurrentfinan-cial year, Modi clung tena-ciouslytohispledge to resortto “systematic, planned,inter-connected and inte-grated”reforms to findawayoutof thecurrentmorass.

Land and labour marketreformsareat the topofCor-porate India's wish-list, as itlooksforwardtoaneconomicclimate for them to resumelong-dried-up investments.

Stating that“everysectorhas to be made future-ready”, Modi said his gov-ernmentwaswedded to cre-ate an ‘encouragingeco-system’forprivate firmsand entrepreneurs, throughcontinuous decisions andsteps. “Corona may haveslowedourspeed (ofgrowth)but India has now movedahead from lockdownwiththe phase one of unlock.Unlock Phase-1 hasreopened a large part of theeconomy,"hesaid.Accordingto him, intent, inclusion,

investment, infrastructureand innovation are crucialfor India to revert back to ahigh-growth trajectory.

The prime minister’scomments come at a timewhen the country’s fiscal sit-uation has deteriorated andthegovernmentisstrugglingto give support to the econ-omyvia own spending,whilealso incentivisingtheplayersintheeconomythroughwhatit calls Atmanirbhar Bharatpackageconsistingmainlyofsupplyside steps.

AdvocatingtheconceptofMake-for-the-World, Modisaid:“theworld is looking fora trusted, reliable partner.India has that potential,strength and ability”. Henoted that while battling

coronaathome,Indiahelpedover150countrieswithmed-ical supplies.

To boost manufacturingand job creation,Modi saidthe government has identi-fied priority sectors such asfurniture, air conditioners,leatherand footwearforspe-cial attention. India importsabout 30% of its air-condi-tioner requirements whilethe country is not a leadingplayer in world marketsexport of leather andfootwear despite being thesecond largestproducer.

Moody'sInvestorsServiceonMonday trimmed India’ssovereignratingbyanotchtothe lowest investment gradeof Baa-3 and retained the“negative” outlook, givingeffect toearlierwarningsofadowngrade if the country’sfiscalmetrics“weakenmate-rially” in the wake of theCovid-19pandemic.

Since the agency hadwarned of downgrade onMay8,theCentreunveiledaneconomic stimulus packageof close to `21 lakh crore(barely 10% of which wasadditional budgetary cost)and theCentre’s fiscaldeficit

in FY20 was revealed to be4.6% of GDP, the highestlevel since FY13. The fiscaldeficits of both the Centreandstatesareexpectedtorisesubstantially in FY21,mostlikely to double-digit levels,given the economic slumpand continued reliance ongovernment spending torevivetheeconomyandmeetthe extra spending obliga-tions related toCovid-19.

Moody's expects India'sreal GDPgrowth to contractby 4% in FY21 due to theshock from the coronaviruspandemic and related lock-downmeasures, followed by8.7%growth in the next fis-cal and closer to 6% there-after. It forecasts the coun-try's debt burden to rise toabout 84% of GDP in FY21,indicating fiscal stress.

CrisilhassaidrecentlythatCovid-19 pandemic wouldlikelyinflicta10%permanentloss to realGDP,soa catch-upto the pre-crisis trend level ofGDPwon’tbepossibleoverthenext three fiscal years.Afterthe global financial crisis, asharp growth spurt helpedcatchupwiththetrendwithintwoyears.

BolsteredMSPpolicy has little bearing on crop outputSimilarly, jowar productionin2018-19droppedby31%despite 43% hike effectedfor its MSP that year. How-ever,theproduction jumpedbynearly70%in the follow-ing year even though therewas only 5% increase in itsMSP. Also, cotton outputslumped by over 14%despite28%rise inMSPtwoyears back as a severedroughtinlargestproducingstate Gujarat ravaged thecrop. Across the country,monsoonwas belownormalat 91% of the long periodaverage in2018.

Production of kharifcropsmainlydependsondis-tributionofrainfallandmar-ket prices, experts said.Though the concept ofMSPhas been designed to send asignal to the market abouttheimpendingpricesofagri-

culture commodities,with-out a robust mechanism -either by physical procure-mentorthroughpaymentofdifferential prices againstMSPs to farmers – it is a‘futile exercise’, oppositionCongress said Tuesday. Inevery kharif season,most ofthe oilseeds and pulses aresold 20-30% below theirMSPswhilethegapsareevenhigherincaseofcoarsecere-als, particularly during har-vesting season (October-December).

The food ministry hassought intervention of thehigh level committee,headed by the Cabinet sec-retary, to tweak the policyon procurement of coarsecereals, food minister RamVilas Paswan said last weekas maize farmers in Biharare selling their rabi-grown

crop at 30-35% below itsMSP.The Food Corporationof India (FCI) is the nodalagency to procure coarsecereals with a rider that thepurchases should be to theextent it is consumed inthat state through the pub-lic distribution system(PDS) where it intends tobuy. States like MadhyaPradesh and Maharashtrahad bought maize fromtheir own funds in last twoyears, still could not ensureMSPs to all.

“It is true that the Centrehas been promoting cropdiversificationtomaizefromwater guzzling paddy inPunjab and Haryana forwhich states have alsoannounced incentives. Butonly an assured procure-ment at MSPwill make theprogrammeasuccess,”agov-

ernment official of Punjabsaid.

Mandi prices of three outoffivemajorrabicrops(MSPswere increased 5-7% for2019-20)were5-15%belowtheirrespectiveMSPsduringApril-May, even as farmersneeded maximum supportduring the lockdown. Theaveragewheat pricewas 1%belowMSP despite the factthat the government hasbought over 33% of outputthisyearfortheCentralPool.Onlymasur pricewas about5% aboveMSP.The gapwasabove 15% in case of chana,inwhichthegovernmenthassofarpurchasedlessthan7%of its production under thePM-Aashaschemewhichwasrolled out in 2018 to helpfarmers get MSPs whenmandi rates fall below thebenchmarkrates.

Mahadeploys tech to fightCovid-19

Ahmedabad

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Whilst care is taken prior toacceptance of advertising copy,it is not possible to verify itscontents. The Indian Express (P.)Limited cannot be heldresponsible for such contents,nor for any loss or damageincurred as a result oftransactions with companies,associations or individualsadvertising in its newspapers orPublications. We thereforerecommend that readers makenecessary inquiries beforesending any monies or enteringinto any agreements withadvertisers or otherwise actingon an advertisement in anymanner whatsoever.

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NANDAKASABEPune, June 2

FARMERS IN MAHARASHTRAare seeking a rescheduling oftheirold loans and sanctioningofnewcrop loansforthiskharifseason,beginninginacoupleofweeks. AgricultureactivistVijayJawandiahasurgedtheCentretodirect banks to give new croploanstofarmersandrescheduletheirold loans so that theycanstandontheirownfeetandstartonacleanslatefromthisseason.

“Farmers across theVidarb-haandMarathwadaregionsarestruggling to get crop loans tobuyseedsandfertilisersandpre-pareforkharifseason.Whilethestategovernmenthasaskedba-nkstohelpfarmersavailcroplo-ans,farmers saythebankshavenotbeencooperative,”Jawandiasaid. As farmershavedefaultedon theirpayments,theyarebe-ing turned away by banks, hesaid.Thekharifseasonbeginsinacoupleofweeksandthefarm-ers are likely to get moneyonlysometime in October -Novem-berwhen the crop is harvested,hesaid.Farmersarenotseekingloanwaiversbutreschedulingofold loanandfresh loans to startanew,hepointedout.

Maha farmersseek reschedulingof old loans

PRESSTRUSTOF INDIANewDelhi, June 2

UNIONMINISTERNITINGad-kari on Tuesday assured in-vestors, who wish to movetheir investment from ChinatoIndia,toaddress theirissuesat central as well as state leveland provide a business-friendlyenvironment.

Terming the prevailingglobal sentiment related toChinaasa“blessingindisguise”,the minister said hewill moni-torandalsotakeuptherequire-ments of such investors withstates to create a friendly in-vestmentenvironment.

“Iassurethat ifyoubringtensuchproposals,I shall takeuptoresolvetheirproblemsatthelevelof thecentral andstategovern-ments,”saidtheminister,addingthatred-carpettreatmentwillbeprovidedtoinvestors.

Addressing the annual ses-sion of CII, he urged large in-dustries to clear outstandingpayments owed to MSMEs in45 days.

However,heacknowledgedthat dues of several large cor-porates are also stuck withpublic sectorundertakings.

On the hardships faced bymigrant labour, Gadkari said,“Regardingthemigrant labour,actuallytheimpressionwhichiscreatedbymediaandotherpeo-plethatourindustryis100%de-pendant upon migrant labour,butwhenIwent intothedetailsafter that the information I re-ceivedonthebasisofthat,some-whereitis10-20%”.

Ahmedabad

CompaniesFINANCIALEXPRESS4 WWW.FINANCIALEXPRESS.COM

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COVIDEFFECTON ITMARKETSalil Parekh, CEO, Infosys

Wecanalready see several Europeancountries andUSstates starting to reopen.Wesee stability andexpansion inourwork in theglobaltelecommunications, high technologyand lifesciences industries

Britannia Q4 netprofit increases26% at `372 croreFMCGPLAYERBritannia IndustriesonTuesdayposteda26.53%increaseinconsolidatednetprofit at`372.35crore forthe fourthquarterendedMarch31,2020.Thecompanyhadreportedanetprofit of`294.27crorein the January-Marchquarterof2018-19.Forfiscal2019-20,thecompanypostedanetprofit of`1,393.60crore,up20.6%from`1,155.46crore in2018-19.

HULdonatesover74,000Covid-19testingkitsHINDUSTANUNILEVER(HUL)hasdonatedover74,000RT-PCRCovid-19testingkitsworth`13croretohelprampuptestingofpatientsinthecountry.ThegovernmentofMaharash-trahasreceivedabout28,800RT-PCRtestingkitstohelpintheearlydetec-tionofCovid-19.OtherswhoreceivedtheRT-PCRkitsincludeIndianCouncilofMedicalResearch,MetropolisLabsandApolloHospitals.

CWCpays interimdividendfor2019-20CentralWarehousingCorporation(CWC)achieveditshighest-everturnoverof`1,710croreduring2019-20.CWChasdeclaredinterimdividendfortheyear2019-20at95.53%ofitspaid-upcapitalasagainst72.20%lastyear.Ofthetotaldividendof`64.98crore,theGovernmentofIndia’sshareis`35.77crore.

EESLJVisfastest-growingIndian-ownedfirminUKENERGYEFFICIENCYServices (EESL),ahome-grownSuperEnergyServiceCompany(ESCO)undertheadminis-trationofthepowerministry,hassetaglobalprecedentinlow-carbondevel-opment.EESL’s jointventure,Ener-gyProAssets (EPAL),hasemergedasthefastest-growingIndiancompanyintheUKinthe‘IndiameetsBritainTracker2020’,developedbyConfeder-ationofIndianIndustryandGrantThornton.

JPMorgantohelpSAGEFoundationtrainstudentsTHESHAHANIAcademic&GlobalEmpowerment (SAGE) Foundationhas said that JPMorganwill donate`17crore tohelp train andupskill4,800graduates fromeconomically-disadvantagedbackgrounds.This isthe secondgrant SAGEFoundationhas received fromJPMorgan; lastyear it got a`76 lakhgrant fromJPMorgan tohelp train200economi-callydisadvantagedgraduates inbanking jobs.

AjoyChoudhuryappointeddirector(finance)atRECNavratnaPSUREC,oneof India’slargest powerfinanciers,hasannounced theappointmentofAjoyChoudhuryto thepost ofdirector(finance)with effect fromJune1,2020upon the superannuationofoutgoingdirector (finance)AjeetKumarAgarwal.Choudhurybringswithhimover33years of experienceworkingacrossvarious functions inthepowersector.

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FE BUREAUPune, June 2

BAJAJ AUTO’S SALES recovery in themonthofMayhas beendrivenbyexports.The two-wheeler major sold 1.27 lakhmotorcycles and commercialvehicles dur-ingMay2020,withexportsaccountingforthebulk of the sales.At 87,054units,BajajAuto’s export volumes during themonth

weremorethandoubleitsdomesticmarketvolumes.Domesticmotorcycle and com-mercialvehicle (CV) sales droppedby83%to40,074unitsduringMay.

Bajaj’stotaltwo-wheelersalesduringthemonthfellby69%y-o-yto1.12lakhunits.Domestic two-wheeler sales during themonth fell by81%y-o-y to 39,286units,while exportswere down54%to93,512units.DomesticCVsales duringMay2020

tumbledby97%to788units,whileexportsweredown44%to13,542units.The totalCVsaleswasdown74%to14,330units.

For the first two month of FY21, thefirm’s has reported a80%decline total intotalmotorcycle andCVsales to 1.65 lakhunitscomparedtothe8.42lakhunitsitsolda year ago. Two-wheeler sales are down80.19%to1.44lakhunits,whileCVsalesisdown82%to20,199units.

ExportshelpBajajAutobegin recoveryprocess

RISHI RANJAN KALANewDelhi, June 2

THEHOTELINDUSTRYonTuesdayurgedDelhi chiefministerArvind Kejriwal anddeputy chief ministerManish Sisodia toreconsidertheirMay29order inwhich5-star hotels, including Crowne Plaza andSheraton,wereasked tobeconverted intoCovid-19 treatmenthospitals inpartner-shipwithprivatehospitals.

Delhi is one of the most impactedstates in India with a high number ofCovid-19positivecases.AsonJune1,ithada total of 20,834 cases, including 8,746recoveriesand523deaths.Thenumberofactive cases in the24hours (May31-June1) stood at 990.OnTuesday,Kejriwal saidthatthecityhadatotalof6,731Covid-19beds,ofwhich4,100werevacant.

IndustryassociationHotelandRestau-rant Association of Northern India(HRANI) said it has urged the Delhi gov-ernment to reconsider itsorder.

“WehavemadearepresentationtotheDelhichiefministeranddeputychiefmin-istertoreconsidertheordermakinghotelsas extension of hospitals,”HRANI Secre-taryGeneralRenuThapliyal toldFE.

HRANI is the north Indian arm of theFederation ofHotel andRestaurantAsso-ciations of India (FHRAI), the apex indus-trybody.

“Hotels are not equipped in terms ofinfrastructure to open such establish-ments. Also we do not have the trainedmanpower to handle such cases.Besides,hotels aregrapplingwith lackof staff duetoshutdownofoperations.Anothermajorissue is that this could have a negativeimpactonthefuturebusinessprospectsofhotels.The hospitality industry has beensupporting the governmentwith respectto quarantine activities and providingfood,etc,”Thapliyal said.FE reached out to Crowne Plaza and

Sheraton hotels,which did not offer anycomments.

Expertsinhospitaladministrationsaidthat getting hotelswould be a huge chal-lenge.“Forinstance,insideourCovidwardswe maintain negative pressure. This is

donebytakingspecialprovisions toregu-late air flowwithin the wards to ensurethat the virus exhaled by the diseased islimited to that room. Besides, traininghotelhousekeeping staffwouldbeahugechallenge.There’s also a danger that thehotel staffmight take back the infectionto the community and vice versa,” said aseniorofficial at a tophospital in thecity.

Hotel industry sources said that con-vertingaluxuryhotelintoaCvoid-19hos-pital would “seriously jeopardise” itsfuture business opportunities as peoplewouldnotwant to stayin thesaidhotel.

Delhihaddirectedfivehospitalstotakeover five luxury hotels and convert theminto Covid-19 hospitals.Medical servicesin these hospitals would be provided bytheattachedprivatehospital.

The five hospitals are Batra hospital,IndraprasthaApollo,BLKapurMemorial,SirGangaRamandMaxSmartSuperSpe-ciality.ThesehospitalswouldhelpconvertHotel Sheraton at Saket, Crown Plaza atOkhla Phase-I, Surya at New FriendsColony, Siddharth at Rajendra Place, andJiviteshatPusaRoadintoCovid-19hospi-tals.

The hotels shall provide regular ser-vicesincludingrooms,housekeeping,dis-infection and food for the patients at thepricenotgreaterthan`5,000forfive-starhotels and `4,000 four/three star hotelsper day per person. The linked hospitalshallbepaidupto`5,000-perpatientperdayfortheirmedical services.

OnMonday, the Delhi DisasterMan-agementAuthority asked districtmagis-tratestoprovideinformationonidentifiedpremisesandlandtoitbyWednesday.TheDMs have to provide information onindoorair-conditionedlocations,particu-larly largemulti-purpose halls, banquethalls and indoor stadiums, for setting upextrabeds forCovid-19patients.

Conversion to hospitals:Hotels urge Delhi govtto reconsider order

FE BUREAUMumbai, June 2

HINDUSTAN UNILEVER (HUL) said onTuesdaythatthecompanywasabletorampup itsproduction to80-90%of itsnorma-tive levels compared to about 70% in themonthofApril.However,therewillbesomeimpactonprofitabilityintheshortterm.

HULsaidit’sseeingheightenedconsumerfocus on health, hygiene and nutritionalneeds.Itsportfoliocomprisingofcategorieslike skin cleansing,home&hygiene,nutri-tion,tea,coffeeandfoods“iswellpositionedtocatertotheseconsumerdemandspaces”.

However, with mobility restrictions,lockdownofretail spacesandfearof lossofincome,the impact ondiscretionarycate-gorieslikehaircare,skincareandcolourcos-metics ismore accentuated.“Whilewe areseeing somedemand revival in these cate-gories,theexacttimewhichthesecategorieswilltaketorecoverfullyremainstobeseen.Ourout-of-homebusinessescomprisingoficecreamsandfoodssolutionsandourcon-

sumerdurablesbusinessofwaterhavebeenmostseverelyimpactedbythelockdown”.

The company said it is operatingwithshorterplanningcycles,steppingupagility,reducing complexity andworking longershifts tobuildresilience in its supplychain.AllofHUL’sfactoriesandallthewarehousesexceptoneinAssamarenowoperational.

HULsaid the future impactonbusinessoperationsisdifficulttoassessatthispoint,as the situation is unravelling fast.“Eventhoughthecurrentsituationisveryvolatile,we are confident about ourability toman-age the crisis and come out of it in astrengthenedposition,”itsaidinaBSEfiling.Onfinancial implicationsofthepandemic,itsaidtherewillbesomeimpactontheprof-itability in the short term;but it expresseddifficultyinassessingtheexactquantumatthisstage.

HUL increases production but expectsshort-term impact on profitability

The company said it is seeingheightened consumer focus on

health, hygiene and nutritional needs

An industry association said hotelsare not equipped in terms of

infrastructure, and do not have thetrainedmanpower for the purpose

FE BUREAUNewDelhi, June 2

GREATEASTERNENERGYCorp(GEECL),which produces coal bedmethane (CBM)gasinWestBengal,reporteda29.6%year-on-year(y-o-y)fall initsnetprofitto$6.99million in FY20,as it sold lesser volumesof gas at a lower prices in the fiscal com-paredtoFY19.Thecompany,listedontheLondon Stock Exchange, sold 10.38mil-

lion standard cubic feet per dayCBMgasinthefiscal,down9.6%annually.Averageprice of gas sold by GEECL in FY20 was$10.27/mmbtu,1.5%lowerthanthepre-ceding fiscal.

The company’s Ebitda fell 24.8%y-o-y to $20.95million.GEECL’s net debt atFY20-end stood at $56.1million,19.4%lower annually.The debt-to-equity ratiowasat0.65,lowerthanthe levelof0.81attheendofFY19.

GEECL’s FY20 profit falls 30%

FE BUREAUMumbai, June 2

INTERGLOBE AVIATION, THE parent ofIndigo Airline, on Tuesday laid out aroadmap thatwill enable it to combat thechallenges posed to the aviation industrybecauseoftheCovid-19pandemic.Theair-line is looking at shoring up cash on itsbooksasitwilltakethesectorafewquartersto deploy its full capacity of 262 aircraft.Fromreturning120high-maintenanceAir-bus CEO aircraft to lessors and replacingthem with the more cost-efficient Neosoveraperiodoftwoyearstonotpayingdiv-idends this year, Indigo is on amission toconservecashandshoreupliquidity.

The country’s largest airline said itwasin talkswith lessors to freeze lease rentalsandwithotherpartnerstonegotiatebettercredit terms. Indigo’s CEORonojoyDuttasaid,“Intimesliketheseweshouldshiftourfocus fromprofitabilityandgrowth to liq-uidityandcash.Weendedthequarterwitha cash balance of `20,400 crore,ofwhich`8,900croreisfreecash.”

The airline expects to unlock at least`3,000-4,000 crore additional cashthroughthesemeasures.

Indigoreportedanet lossof`870crore

intheMarchquarter,astheclosureofflightoperations during national lockdown onaccount of Covid-19 impacted its finan-cials.Forthefullfiscalyear,Indigoreportedanet loss of `233 crore compared to anetprofit of `157 crore in the previous fiscal.However,theairlinedidbreakevenatafullyear level.Till the end of February,the air-linewasprofitable,butasitenteredMarch,unitrevenuesstartedfalling,resultinginanoperatingloss,explainedDutta.

Even as profitability took a knock,rev-enues fromoperations during the quarter

increasedby5.3%year-on-year to `8,299crore.Revenuesincreasedduringthequar-teronthebackofhigherancillaryrevenuesand amodest increase in passenger ticketsales.Total income for the quarter endedMarch 2020 stood at `8,634 crore, anincrease of 4.5% compared to the corre-spondingquarterlastyear.Forthequarter,Interglobe’s passenger ticket sales rose by1.3%year-on-year to `71,30 crorewhileancillary revenues grewby30.2%y-o-y to`10,75 crore,an increase of 30.2% com-pared to the same period last year.Giventhat cargo operations remained relativelyuscathedduring the lockdownduetosup-ply of essentials, the company is likely tolookatrampingupcargooperations inthecomingquarters.Duttasaid,“Wewillfocuson cargo operations evenmore to rake inrevenues.Wehavelearnedvaluablelessonsaboutthedemandandscopeforcargodur-ing the lockdown and these lessons willserve uswell to augment cargo operationsinthemonthsahead.”

Operationally,thecountry’s largestair-linereportedoperatingincomeof(Ebitdar)of `86 crorewith Ebitdarmargin of 1%,compared to Ebitdarof `2,201 crorewithEbitdar margin of 27.9% for the sameperiodlastyear.

Indigo reports net loss of`870cr; lookstoshoreupcash

«

Q4FY19 Q4FY20(` cr)

Report card% chg

«

5.3

27.9

1

Revenue fromoperations

EBITDAR Net profit/loss

EBITDARmargin (%)

2,202

86 596

-871

7,883

8,299

«96 «2,690 bps

●MARCHQUARTER

FE BUREAUMumbai, June 2

TATAMOTORS SAID onTuesday that thecompany had resumed operations at alltheplants,withtheJamshedpurplantalsogettingapproval onMay27,2020.JaguarLand Rover (JLR) has also begun opera-tionsat itsplantsglobally.

About70%oftheshowrooms,salesandserviceoutletsand43%ofthesalesoutletsopened for commercial vehicles, coveringabout 56%of the retail market. For pas-senger vehicles, 59% of the showroomsresumed operations covering 69%of theretail market.Also,80% of dealerwork-shopsandTataAuthorisedServiceStations(TASS)havecommencedoperationsinCVsand69%workshopshavestartedforPVs.

Thecompanysaidthatdemandisgrad-ually starting to improve.On the supplyside,90%ofsuppliersforCVshavereceivedpermissions to commence operations,while 80% have started operation, andonly around 60%have been able to startthesupplies.ThesupplysideonthePVseg-menthas seen98%of suppliers receiving

permissionandalsostartedoperations.Ason March 31, 2020 the cash and cashequivalentofthecompanystoodat`4,700crore and the undrawn credit facility of`1,500crore.Tofurthershoreupliquidity,the company has issued commercialpapers of `3,500 crore and also raised`1,000crorethroughNCDs.

JLR’s joint-venture plant in Changshu(China)hasbeenoperationalsinceMarchasvehicle sales recover there and customersreturn to showrooms following the easingofthe lockdown.Thecompanyisgraduallyresuming production at the Solihull andengineplantsintheUK,theSlovakiaplant,andcontractassemblylineinAustria.

TataMotors, JLR resume ops

PRESSTRUSTOF INDIAMumbai, June 2

BATTLINGAGAINSTCHALLENGES in thewake of the Covid-19 pandemic,diversi-fiedconglomerateGMRGrouphasreviseddownwards employees’ salary by up to50%witheffect fromMay,asourcesaid.

Thereductionincompensationismax-imum at the highest level, the sourceadded.

The Bengaluru-based infrastructuremajorhaspresenceinroadsandhighways,energyandairportsectors.

“As part of the revised structure, thegroup has done away with the variablecomponent in employees’ CTC (cost tocompany)andreplaceditwithspecialper-

formanceallowance,whichwillbe treatedasaspecialvariablecomponent,”thesourcetoldPTIhere.

Thiswouldresultinasalaryreductionofupto50%forvariouscategoriesofemploy-ees,includingseniorandtopmanagement,effectiveMay2020,thesourcesaid.

Responding toane-mail query,aGMRGroupspokespersonconfirmedthedevel-opmentsayingtheemployees’compensa-tionhasbeenrestructured.

“Inviewof the challenges faced by theinfrastructure sector/industry due toCOVID-19, GMR has taken steps torestructure the compensation of employ-ees.Aspecialvariablecomponentlinkedtobusinessperformancehasbeenintroducedto alignwith currentmarket conditions,”

thespokespersonsaid.A recent industry report has forecast

thatairportsworldwideareexpectedtoseea decline ofmore than 4.6 billion passen-gers and revenue totalling $97 billion(around`7.3 lakhcrore) in2020amidthecoronaviruspandemic.

The Airports Council International(ACI),which is the apex bodyof the globalairports,alsoestimatesareductionofovertwobillionpassengersatthegloballevelinthesecondquarterof2020andmorethan4.6billionpassengers forallof2020.

The decline in total airport revenueson a global scale is estimated to be$39.2 billion in the second quarter andmorethan$97billionforthisyear,accord-ing to theACI.

GMRGroupcuts staff salarybyup to50%

ASMITADEYNewDelhi, June 2

FACEDWITHAtruncatedworkforce,lossofpeak business hours,operational restric-tionsinmajormarketsandtheuncertaintyarounduncorkingliquorbottles,restaurantsacrossthecountryareunsureifthepermit-tedrelaxationswill enable themto‘unlock’theirfullbusinesspotential.

Sagar Daryani, co-founder & CEO atWow!Momo,saidaconsiderablenumberofmigrant labourershadmovedbacktotheirnative places, and the biggest challengewouldbetooperatewithlimitedstaff.Also,with themajorchunkof business transac-tionshappeninglateevening,therestrictiononmovementbeyond9pmisvery“demo-tivating”.Daryaniseesprofitabilitytakingahitasadherencetosocialdistancingnormswill lead to cost escalation,but companies

cannot afford to increase prices.“Businessnormalcycanonlybe expected inDecem-ber.Next sixmonths are going tobe toughand companieswill change theirbusinessmodels.We may have to look at sharingspaceswithotherbrandsoropenmorecloudkitchens,”Daryani toldFE.Some landlordshave agreed to rentalwaivers and discus-sionswiththerestareon,Daryanisaid.

JatinMallick,chefandco-owneratNewDelhi-basedTres,said thepainpointswerenotbeingabletoserveliquorandtooperatewith less than60%seating capacitywhilemaintaining social distancing.As dinnermakesupthelion’sshareoftheeatery’srev-enue,the 9 pmdeadlinewill furtherhurtbusiness.“Withthecurrent restrictions,weare still contemplatingwhether it isworthopeningupatthemoment.Currently,wearefocusingonhomedeliveries,”Mallicksaid.

JoySingh,co-partner at Raasta&Yeti,

saidtheworkforceremainedacauseofcon-cern as people had relocated and callingthembackwas anarduous task.Singh saidwith brandYeti, theyhad decided to con-tinuewithdelivery-onlyservice andwouldresumedine-inonlyafterJune30,oncethegovernment allows operationswith lesserrestrictions.

GauravNarang,founderof restaurant-cum-cafeCoffeeCulture that runs22out-lets in 17 cities, said non-availability oflabour,reinvestmentofcapitalandrenego-tiating dealswith landlordswere the pri-marychallenges.“Wewill beopeningup innon-containment zones,butyes ourpeakhourshavealwaysbeen7pmtillmidnightandthe9pmcurfewwilldefinitelyaffectourtopline. But, we hope customers under-stand,”hesaid.

ZorawarKalra,founderandMDatMas-siveRestaurantsthatrunsbrands likeFarzi

Café,too,found timing restrictions a con-cerninanotherwisepositivemoveforopen-ing up businesses.Dinner timemade upabout 80%of restaurant business and asmoreoffices reopened,corporatesworkingtilllatehourswouldnotbeabletograbtheirdinner,he observed.Takeawayorderswillcertainlyout-numberdine-in,andthefirmhas curatedanexclusivedeliverymenu for

guests,Kalrasaid.Echoing similarviews,KumarSaurabh,

executive director at BurmanHospitalitythat runsMexican food chainTacoBell inIndia,saidwhile the curfewwould impactdine-in customers, delivery orders wereexpectedtobesteadyand,infact,growuntiltheenvironmentstabilised.

The same was the opinion of JaydeepMukherjee, brand head at Smoke HouseDeli.He ratherstressed that thecompany'sdeliverysaleswere almost close to thepre-Covidlevelsalthoughdine-inprimarilycon-tributed to the topline.While rise inopera-tional costs tomeethygiene standardswillhit business,the companydoesnotplan toshutoutlets,givenitsstablefinances.“Storeopeningswill be staggered. Itwill take atleast sixmonths before business is back tonormal,thattooifthegovernmentsupportsthe industry.Else,some small restaurants

mayhavetoshutshops,”Mukherjeesaid.“Peakhoursforanyrestaurantisduring

the lunch and dinner hours. While theevening curfewwill have an impact on therestaurant business,we are committed tocontinuing operations as pergovernmentdirectives across all our restaurants,”saidMokshChopra,chiefmarketing officer atKFCIndia.

Neha,marketing director at PizzaHutIndia,infusedsomepositivityintothebleakscenario.Althoughhesitation to dine outwould lingeronevenafter the lockdown isover,trustedbrands arewell-positioned toweatherthestorm,shesaid.“Therewillbeaspike indemandwhereverweopen—be itin Bengaluru,Mumbai or Delhi; we haveequippedall ourstores to offercontactlessdining.Right fromaccessing themenu tomakingpayments,theentireprocesswillbedigital,”Nehaadded.

Restaurantswelcome government’smove to unlock butwaryabout challenges

JSWSTEELRAMPEDup its capacityutili-sation to an average of 83% inMay from38% inApril.The crude steel productionstood at 12.48 lakh tonne inMay,morethandouble theoutput inApril.

However,on ayear-on-year basis,pro-duction inMaysawamoderatedeclineof2%.Ratings firmMoody’s Investors Ser-vicerecentlyplacedJSWSteel’sBa2corpo-ratefamilyrating(CFR)andtheBa2seniorunsecured ratingunder reviewfordown-grade. The ratings outlook was revisedfromstable to“ratingsunderreview”.

KaustubhChaubal, lead analyst at JSW,said,“Thereviewfordowngradereflectsourexpectation thatweak steel demandwillstrain JSW’s credit profile,at least throughthefiscalyearendingMarch2021.”“Infact,there is a distinct possibility that JSWwillremaininbreachofourdowngradetriggersforitsBa2CFR,”headded.FitchRatings,too,downgraded the issuerdefault ratings ofJSWSteel to BB- from BB, and outlook tonegative. FEBUREAU

JSWSteel rampsup capacity to83% inMay

Ahmedabad

5FINANCIALEXPRESS

WWW.FINANCIALEXPRESS.COM WEDNESDAY, JUNE 3, 2020

( Power System Control Centre )

Trombay Thermal Station, Mahul Road,Chembur Mumbai -74

(E-mail: )hybridbid@tatapower.com

e-Bidding Tender No ce

As per the guidelines issued by Government of India & approval given by MERC, tofulfil Renewable Purchase Obligation (RPO), The Tata Power Company Limited –Distribution Business in Mumbai Licence area (Tata Power-D) is inviting Long TermBids for Procurement of 225MWgrid connectedHybrid Power (Wind&Solar) throughcompetitive bidding process on website .https://www.bharat-electronictender.comThe schedule of bid process is as follows: -

Sr. No. Event Date Time1 Availability of Bid document on Portal 03/06/2020 17:00Hrs

2 Pre-bid meeting -online through MS team 16/06/2020 11:00Hrs

3 Last date for submission of Technical & Financial bids 06/07/2020 17:00Hrs

4 Opening of Technical bids 07/07/2020 11:00Hrs

For more details of Notice for Invitation of Tender (NIT), please visith t tps : / /www.bhara t -e lec t ron ic tender.com and Tata Power webs i tehttps://www.tatapower.com.

Head – Power Purchase & ABTTata Power Trombay, Mumbai 400074

SR

NO.PARTICULARS

Rupees in lakhs

31-Mar-2020 31-Mar-2020

(Audited)

31-Mar-2019

QUARTER ENDED

EXTRACT OF STATEMENT OF AUDITED CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER / YEAR ENDED 31 MARCH 2020

YEAR ENDED

31-Mar-2019

(Unaudited) (Audited)

2 Net Profit for the period (before tax and exceptional items) 8,959 4,811 6,125 20,274 18,713

1 Total income 50,157 53,708 73,056 1,91,943 1,86,010

3 Exceptional items (net) (Refer note 2) - - 6 - 1,985

4 Net Profit for the period before tax (after exceptional items) 8,959 4,811 6,131 20,274 20,698

5 Net Profit for the period after tax 8,908 2,777 2,963 15,113 12,676

(after exceptional items and after non-controlling interests)

6 Total Comprehensive Income for the period 8,908 2,785 2,848 15,136 12,643

(Comprising profit for the period (after tax) and Other

Comprehensive Income (after tax)

7 Paid-up equity share capital (Face Value Rs. 10/- each) 14,846 14,846 14,808 14,846 14,808

8 Earnings per share (EPS)

* Not Annualised

(a) Basic EPS 6.11* 1.76* 2.00* 10.19 8.58

(b) Diluted EPS 6.03* 1.75* 1.99* 10.05 8.53

31-Dec-2019

For Welspun Enterprises LimitedSd/-

Sandeep GargManaging Director

DIN 00036419Place : MumbaiDate : 01 June 2020

(Audited) (Audited)

1 The above is an extract of detailed format of quarterly / yearly financial results filed with the stock exchanges under Regulation 33 of the SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015. The full format of the quarterly / yearly financial results are available on theStockExchangeswebsitewww.nseindia.comandwww.bseindia.comandalso on company'swebsitewww.welspunenterprises.com

2 Exceptional items -Gain/(loss) for the period includes.

Notes :-

SR

NO.PARTICULARS

Rupees in lakhs

31-Mar-2020 31-Mar-2020 31-Mar-2019

QUARTER ENDED YEAR ENDED

31-Mar-2019

- - 6 - 1,985

additional consideration - - 6 - 141

(ii) Gain on sale of stake in Dewas Bhopal Corridor Private Limited - - - - 1,844

(I) Gain on sale of stake in Welspun Energy Private Limited -

31-Dec-2019

3. Additional information on standalone financial results is as follows :-

SR

NO.PARTICULARS

Rupees in lakhs

31-Mar-2020 31-Mar-2020

(Audited)

31-Mar-2019

QUARTER ENDED YEAR ENDED

31-Mar-2019

(Unaudited) (Audited)

1 Total Income 46,552 50,112 71,459 1,81,263 1,79,404

2 Net profit for the period (before tax and exceptional items) 6,296 5,485 8,467 21,407 21,217

4 Net profit for the period after tax 4,877 4,058 4,631 15,934 15,369

3 Net profit for the period before tax (after exceptional items) 6,296 5,485 8,473 21,407 23,202

5 Total Comprehensive Income for the period (after tax) 4,891 4,058 4,518 15,949 15,337

31-Dec-2019

(Audited) (Audited)

CIN: L45201GJ1994PLC023920Regd. Office :Welspun City, Village Versamedi, Taluka Anjar, District Kutch, Gujarat 370110.

Corp. Office :Welspun House, Kamala City, Senapati Bapat Marg, Lower Parel (West), Mumbai - 400013.

Website: www.welspunenterprises.com Email Id : companysecretary_wel@welspun.com

WELSPUN ENTERPRISES LIMITED

(Audited) (Unaudited) (Audited) (Audited) (Audited)

Canara Robeco Mutual FundInvestment Manager : Canara Robeco Asset Management Co. Ltd.Construction House, 4th Floor, 5, Walchand Hirachand Marg, Ballard Estate, Mumbai 400 001.Tel.: 6658 5000 Fax: 6658 5012/13 www.canararobeco.com CIN No.: U65990MH1993PLC071003

NOTICE-CUM-ADDENDUM NO. 16

Change in the constitution of the Board of Trustees of Canara Robeco Mutual Fund

All the unit holders of Canara RobecoMutual Fundare requested to take note thatMr. Deveshwar Kumar Kapilahas ceased to be an Independent Trustee of Canara Robeco Mutual Fund with efect from 31st May, 2020.

All references to him in all the Scheme related documents, therefore, stand removed. This addendum shallform an integral part of the Statement of Additional Information (“SAI”) for the schemes of Canara RobecoMutual Fund as amended from time to time.

Unitholders are requested to visit www.canararobeco.com in respect of their amounts remaining unclaimedor unpaid and follow the prescribed procedure therein.

For and on behalf of Canara Robeco Asset Management Company Ltd.(Investment manager for Canara Robeco Mutual Fund)

Date: 02-06-2020 sd/-Place: Mumbai Authorised Signatory

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

Registered Office: 12th Floor, Narain Manzil, 23, Barakhamba Road, New Delhi - 110 001.

Corporate Office: One BKC, 13th Floor, Bandra Kurla Complex, Mumbai - 400 051.

Tel.: +91 22 2652 5000, Fax: +91 22 2652 8100, Website: www.iciciprumf.com,

Email id: enquiry@icicipruamc.com

Central Service Office: 2nd Floor, Block B-2, Nirlon Knowledge Park, Western Express

Highway, Goregaon (E), Mumbai - 400 063. Tel.: 022 2685 2000 Fax: 022 26868313

ICICI Prudential Asset Management Company LimitedCorporate Identity Number: U99999DL1993PLC054135

No. 001/06/2020

To knowmore, call 1800 222 999/1800 200 6666 or visit www.iciciprumf.com

As part of the Go Green Initiative, investors are encouraged to register/update their e-mail id

and mobile number to support paper-less communications.

To increase awareness about Mutual Funds, we regularly conduct Investor Awareness

Programs across the country. To knowmore about it, please visit https://www.iciciprumf.com

or visit AMFI’s website https://www.amfiindia.com

Mutual Fund investments are subject to market risks,

read all scheme related documents carefully.

Notice-cum-Addendum to the Scheme Information Document (SID)/Key Information

Memorandum (KIM) of ICICI Prudential Ultra Short Term Fund (the Scheme)

NOTICE is hereby given that ICICI Prudential Trust Limited has approved change in

the maximum investment amount per investor under the Scheme with effect from

June 4, 2020. The revised provisions under the Scheme are stated below:

Maximum Investment Amount per investor including existing investment amount

(based on Permanent Account Number of first holder) at the time of investment:

1) The Maximum Investment Amount across all folios shall not exceed ` 50 crore

except to the extent detailed in point no. 2 below.

2) The AMC/Mutual Fund may accept an amount greater than ` 50 crore (“excess

amount”/“said amount”) upto ` 75 crore, provided the aggregate of all holdings

in excess of ` 50 crore, including the excess amount, does not exceed 10% of the

Scheme’s AUM, which is declared on the last day of preceding calendar quarter.

Investors are requested to take a note of the above change.

All the other provisions of the SID/KIM/addenda of the Scheme except as specifically

modified herein above remain unchanged.

This Notice-cum-Addendum forms an integral part of the SID/KIM/addenda of the

Scheme, as amended from time to time.

For ICICI Prudential Asset Management Company Limited

Place : Mumbai Sd/-

Date : June 2, 2020 Authorised Signatory

Ahmedabad

WEDNESDAY, JUNE 3, 2020

FINANCIALEXPRESS6 WWW.FINANCIALEXPRESS.COM

❝ ❝

KEYTOCONTAINMENTLavAgarwal, joint secretary, Health Ministry

Wehaveaskedall states to analyse the trajectoryof

thecases in their respective states. If a state thinks

that it needs to set up temporaryCovid-19care

centres, then itmustdo so

THEARRIVALOFGDPdataforthe lastquarterandyearis the latest confirmation—ifmoreproofwasneeded—that the governmentmod-

elling its policy responses to theCovid-19 economic shock bydrawingparallelswith2008isgrosslymisplaced.Inanycase,a ratingdowngradehas justhappened.Thisremovesthefears,ifany,about the consequences of larger fiscalintervention towards income supportthanthe0.8%ofGDPconsideredsofar.In overlooking the need fornear-termdemand support,and sole deploymentof guaranteed credit lines, loans, andstructural reforms as themain policysustenance,thegovernmentiscommit-tingaseriouserror.Thelatterwon’tworkwhendemandanditsoutlookareasdireas these are.To use the virus analogy,thereisnotmuchpointinmakingreha-bilitation arrangementswhendesper-atelyrequiredoxygenisnotprovidedtoapatientonventilatorsupport.There isdangerthatthepatient,sufferingmuchco-morbiditywith an unprecedenteddisease,maynotcomeoutoftheICU.Thegovernment should reexamine andadaptitspolicystrategy.

The `20-trillion package is largelyregarded inadequate in dealing withlarge-scaleincomelossesinflicteduponthebottommosthouseholdsbythelock-down.A key reason for the controlledspending,asthefinanceministerreport-edlyexplained,was to avoid instability,drawing lessons from the 2008 crisis.Thismindfulnesstoevadethepitfallsoflarge spending and the alternate focusupon guaranteed loan support for theweakestbusinesses(MSMEs)isappreci-ated by some. A few have argued thisensures prudent evaluation,preservesdebt accumulation,while someothersinterpreted the spending restraintintendstoretainpolicyspaceforlaterusewhenthismaybeneeded.

Lostamidstthisarepresentrealities:That2020isnot2008,andthatboththeyears as well as crises are poles apart.Thereareoutstandingdifferencesintheshockcharacteristicsandcontext—non-trivial and critical fordesigning policyactions.If policy responses are set onlyuponthepast,failtodiagnosea‘new’dis-ease andoverlook existing co-morbidi-ties,suchnarrowsightcanbehurtful.

2008was a financial crisis. Reces-

sions triggered by financial shocks aredeepandlong-lasting,withalongrecov-ery, compared to real recessions—becauseliquidityproblemsdisruptcreditintermediation,impacting investmentand,eventually,growth.If financial sec-torweaknesses persist,structural dam-ages followwithpermanent lossofout-put. Policy responses in 2008 actedaccordingly,inIndiaandworldwide.

The 2020 recession is deliberately-inducedduetoepidemicpolicy.Itischar-acterised by a sudden but extendedfreezeoftherealeconomy,resultingcashflowpressuresupon firmsandhouseholds fromsus-pendedoperations,sharpdrops inemploymentandearnings, and overallspending. Rise in bank-ruptcies and unemploy-menthavethepotentialtoinflict permanentbalancesheetdamages,raisingtheriskof realeconomyprob-lems feeding back to thefinancial sector via debt defaults andsubmerging it in crisis too.In addition,the Covid-19 shock is drawn-outwithhigh,enduring uncertainties inmanyaspects,includingnon-economic.

Contextiscriticalforpolicyformula-tionbecauseapolicymakercanonlystartfromwhere thingsare,i.e.,present con-ditions.Last Friday’s data that showedFY20GDPgrowthdeceleratingto4.2%markedthecontinuationofadownwarddrift for three successive years.Thesedata barely capture any ‘lockdown’impacts; the production shock fromvirus’disruptions tosupplies is concen-tratedintothelastquarteralone.

Besides thiswell-known aggregatebackdrop,2020 has farmore co-mor-bidities. One, the financial system isextremelyvulnerable:Banks,publicandprivate,are inworse healthwith grossNPAsat9.3%(2.4%in2008),lessercap-italised,loss-making;alargeprivatebank

failedthisFebruary.Blocked intermedi-ationmeant severalyearsof credit star-vation; bank credit almost ground to ahalt last year as raised risk-aversionimpacted the real economy.Non-banksare equally fragile,or rathermore.Fast-paced lending fed credit-starved busi-nesses,butstretchedbalancesheets,witheventual illiquidity and insolvencies;several large entities have failed sinceSeptember2018.Fearandlackofconfi-dencepervadesthefinancialsystem.Nosuchissuesexistedwhenthecrisisstruckin2008.

Ontherealside,corpo-rate health is muchweaker—profit shares inGDP range 3-4% in pastsixyears,a steep fall from7.8% in 2008. MSMEs,themain focusof currentsupport,alreadybearhighlevels of stressed assets;the precise quality isunknown as most areunderregulatoryreprieve

for nearly two years, perhaps restruc-tured.Households,thebastionofprivateconsumerdemand,are overleveragedtoo; an inclusivemeasure assesses thestockofhouseholddebtatabout31.3%ofGDP,with rapid increase in past 5-6years and falling incomegrowth in lastthree. Unsurprisingly, net householdfinancialsurplusshares inGDPin2020are half the 2008 level! Finally, thestrained public balances are too wellknown for furthermention,except tounderline that provisional governmentaccounts’dataonFridayshowedthefis-calgap0.8pointslargerat4.6%ofGDP!Inconjunctionwithpublicdebtstockinexcess of 70% in relation to aggregateoutput,Indiais inafull-blownfiscalcri-sis.Moody’shasrecognisedthis.

2008washeraldedbyseveralyearsofabove-9%GDPgrowthfromallsources,robustfiscalposition(centraldeficitwas2.54%ofGDP,2007-08),amongstother

things.Ceterisparibusdoesnothold for2020becausehigh indebtedness,weakbalancesheets,creditstarvation,slowinginvestment andgrowthdescribe it dif-ferently. The government shouldsquarely recognise the 2020 crisis issuperimposeduponanexistinggrowthcrisis of structural proportions.It can’tactasifitwere2008.Evenwhenremem-beringthelastchapterfromhistory,poli-cieshavetorespondaccordingly.

Failing to spendnow,when60%ofaggregate demand is alarminglydam-aged from loss of jobs, livelihoods andpay-cuts of the low-paid and youngerwhitecollarworkers,professionals,daily-wageearners,andsoonisaglaringlapse;many of these have high spendingpropensities. Then, there is the pan-demic-induceddepression in demandduetovoluntaryrestraints,prevalenceofmildercontainmentmeasuresthrough-out its duration.It is clear the economywill operate below-capacity for longerthanoneyear,layeredabovetheexistingor pre-Covid slack. This makes thedemandoutlookgrimmer, uncertain.

Manypointtomedium-termgrowthimprovements fromstructural innova-tions.That is distant.The economywilllanguish in the interval because con-sumerdemandwill remain depressed,investmentwon’tgrowandrecoverywillbeslow.Ifrecoveryslowsdown,thenthepresent shockcouldbecomestructural,enmeshtherealandfinancialsectors.

Insuchasetting,adequateanddirectincomesupport isdesperatelyrequired.Flickersofdemandgivefirmsareasontostayalive,encouragethemtoavailthosecredit lines.Debt-laden businesses areunlikely to contract furtherdebtwhenrepaymentprospectsremainuncertain;theymightshutshopinstead—therearereports ofMSMEs closures.Even large,unlockingfactoriesareoptingtowaitfordemandbeforeincreasingproductionasperearlyreports.

Whatexactlyisthetimeorconditionthegovernmentisholdingfirepowerforisdifficult tounderstand.Thatmakes itseem that all rehabilitation arrange-mentsaremadeandtonic-spendingwillbe givenonce thepatient recovers.But,thefiscaloxygenrequiredtogetoffven-tilatorsupport andoutof the ICU isnotbeinggiven!Givethatoxygen,andhope-fully,the tonicwill be a self-sustaining,upwardspiralthatfollows.

●CRISIS CONUNDRUMDRAWING PARALLELSWITH 2008 ISMISPLACED; FASTACTIONNEEDED

NOWTHATADOWNGRADEHASHAPPENED

RENU

KOHLINewDelhi-basedmacroeconomist

INDRANIL SENGUPTA

&AASTHAGUDWANISen Gupta andGudwani are India economists, BofASecurities

WE HAVE BEEN cautioning investorsabout the rising risks of a sovereigndowngrade.Moody’shasjustcutIndia’srating toBaa3 fromBaa2 (while retain-ingnegativeoutlook),onlowgrowthandrising fiscal risks.We,however,see thecurrent slowdownas cyclical drivenbyexcessiveRBItighteninginmid-2018;areal lending rate shock on falling coreWPI inflation in 2019, and now, theglobalCovid-19shock.TheCentre’sfiscaldeficit (6.3% of GDP FY21 forecast)breaching the long-run average by180bp is surely justified with growthfalling~900bpbelowpotential.So,canIndia fall belowinvestment grade?Notreally,duetothreebuffers.RBI’shighFXreserves shouldprotect the rupee fromanyspeculativeattack.Second,theMoF

willlikelyrecapitalisePSBsthroughnon-fiscal leverssuchasissuingrecapitalisa-tion bonds and/orusingRBI’s $127bnrevaluation reserves. Finally, a run ofgoodharvestsshouldcushiontheCovid-19shock.Moody’s downgrades India on

growthand fiscal risks:Moody’s hasjust cut India’s sovereign rating toBaa3fromBaa2 (bothwithnegativeoutlook)bringing it to the lowest investmentgrade.Thiswasdrivenbyrisks of a sus-tained period of relatively lowgrowth,furtherdeterioration in the fiscal posi-tionandstressinthefinancialsector.Itsnegative outlook reflects dominant,mutually-reinforcing, downside risksfromdeeperstressesintheeconomyandfinancialsystemthatcouldfurthererode

fiscal strength.S&Pand Fitch Ratingscurrently rate India at BBB-with stableoutlook,thatalsohappenstobethelow-estinvestmentgrade.Slowdowncyclical:Wesee the cur-

rent slowdown as cyclical,driven by3back-to-back shocks. Mid-2018 sawexcessiveRBItightening.Whilenominallending rates cameoff in2019,onRBIeasing,fallingcoreWPIinflationledtoaspike in real lending rates. 2020, ofcourse, is seeing the global Covid-19shock.WhileweexpectGDPtocontractby 2% in FY21, FY22 growth shouldreboundto9%.Fiscal stimulus key to support

recovery:Wecontinuetoarguethatfis-cal stimulus is the need of the hour,notwithstanding Moody’s. While theCentre’sfiscaldeficit,atour6.3%ofGDPFY21 forecast,will overshoot the long-runaverageby180bp,thisissurelyjusti-fiedwith growth falling~900bpbelowpotential.It is the fall in growth,due totheCovid-19 shock,that is leading to ahigherfiscaldeficitthanviceversa.FXreserves,non-fiscalPSBrecap,

rains:High FX reserves.We highlightthatRBI’s highFXreserves shouldpro-tectINRfromanyspeculativeattack.Thiscreatesthespaceformonetaryandfiscaleasing.RBI is expectedly recouping FXreserves.Non-fiscalPSBrecap:TheMoFwill likely recapitalise PSBs to de-stressthe financial sector throughnon-fiscallevers—issuing recapitalisation bondsand/orusingRBI’s $127bn revaluationreserves.Goodharvests:Afterabumpersummerrabiharvest.Weexpectthewin-ter kharif sowing to benefit from theMet’sforecastof102%ofnormalsouth-westmonsoons.

EditedexcerptsfromIndiaEconomicWatch,BofAGlobalResearch,June2.

Kerala model shouldhave been followedApropos “Are 80% casesasymptomatic? ICMR clueless”(FE, June 2). Many states havefailed miserably in carrying outcontact tracing in an efficientmanner which has resulted in anincreasing number of Covid casesdespite a long nationwidelockdown. Had the uniongovernment sent a team to studythe modus-operandi adopted bythe Kerala government andadvised the states to follow it, thenumber could have beencontained. Kerala government hadpublished the photographs ofcovid patients in local newspapers, it had also shownphotographs of such patients onlocal TV channels and had askedpeople to make a self-declaration.Vietnam has also been successfulin containing Covid-19 by doingmeticulous contact tracingresulting.— Mahesh Natani, Indore

Moody’s bluesApropos “Moody’s cuts rating,retains -ve outlook”, (FE, June 2).Thewriting on thewall becameclear with Moody’s InvestorsService downgrading India’ssovereign rating to Baa3—a notchabove ‘Junk’. The rating agencyexpects the country’s GDP tocontract by 4% in the currentfinancial year because of the shockfrom the pandemic and relatedlockdown measures. It stumps onethat despite the downgrademarkets continue to fly high,ending in the green for the fifthday on the trot.— N J Ravi Chander, Bengaluru

RBI’s high FX reserves should protectINR from any speculative attack.Thiscreates the space formonetary andfiscal easing

LETTERSTOTHE EDITOR

To spendornot to spend

Moody’s downgrade:What now?

Failing to spendnow,when 60% ofaggregate demand

is alarminglydamaged, is aglaring lapse

Stateswill benefit fromthereform, sowhycomplain?States got freemoney—in schemes like Uday—and did

little reform,so the Centre’s conditions aren’t that unfair

Canweget information?

SkillsFIRSTMaharashtra has donewell to soften its ‘sons of the

soil’ stance, but there needs to be evenmore relaxation

GIVENTHATSTATESaregoingtobewoefullyshortonresourcesthisyearastaxcollectionsdwindle,theywillhavetoworkthatmuchextratoimple-ment the reforms set out bytheCentre to enable themtoborrowmorefromthebondmarkets.Thereasontheadditionalborrowings—upto2%

ofGSDPbeyondthepermittedFRBMlimitof3%ofGSDP—areimportantisthat,with-outthis,stateswillbeforcedtoaxecapitalexpenditure.SeveralcommentatorsaswellasfinanceministersofvariousstateshavesaidthatitisunfairfortheCentretosetcon-ditionsforthestatestomeetinthesedifficulttimes.Certainly,thebanofalcoholsalesforabout twomonthshit state government revenues,and the central governmentpenchanttolevy‘cesses’insteadofstraightforwardtaxesinmanyareasmeanslesshastobesharedwiththestatesunderthefinancecommissionformula.

But, the conditions being insisted upon aremore in the nature of reforms—inareassuchasPDS,easeofdoingbusiness,powersectorandurbanlocalbodies—andcanonlybenefitthestates.Thecarrot-andstickapproachisprobablyneededtopushstates intoimplementingthereforms.Inthepowersector,forinstance,despitetheUdaybailouts—andtherewasanotheraroundadecadebeforeUday—thestatesdidprecious little reform,as a result ofwhich state electricity boards (SEBs/discoms)owepower-generating firms about`90,000 crore.And insteadof penalising stategovernmentsforthis,thecentralgovernmenthasonceagainagreedtobailouttheSEBswith a `90,000 crore loan package fromPFC andREC.So, it is hardlyunrea-sonable for the Centre to ask that states bring down the aggregate technical andcommercial (AT&C) lossesandalsonarrowthegapbetweenaveragecost andaver-age revenues.This shouldhavehappened in thenormalcourse,but forthe last twodecades,stateshavefailedtoraiseelectricitytariffs toallowSEBs/discomstobreakeven. Indeed, the other conditions like those on property taxwill onlyhelp urbanlocalbodiesfunctionbettersincetheirfinanceswill improveasaresult.Also,ensur-ing that the one-nation,one-ration-card scheme gets going, and installing PoSmachinesatFairPriceShopswillultimatelybenefitthelocalpopulation,aswilltrans-ferringcashtofarmersinsteadofchargingthemlowerpowertariffs.Theconditionsmay sound like diktats,but the fact ismany states have been reluctant to reform.Afterall,ifstatescomplywiththeDPIIT’seaseofdoingbusinessnormsandthebusi-nessenvironment improves,theywill attract investment.

Insteadofsittingbackandcomplaining,thestatesmightwanttomoveforwardonreformssincenotdoingsocouldcostthemheavily.Giventheexpected5%GDPcontractioninFY21,and,therefore,acollapseintaxrevenues,stateswillbeleftwithvery little to spendon capex.The budgeted`7.8 lakh crore of devolution forFY21couldendupcloserto`5lakhcrore,ashortfallof`2.8 lakhcroresincetheCentre’s`24.2lakhcroretargetwillnotbemet.Also,sincetaxcollectionsinFY20wereshortby`1.5 lakh crore, the states got `53,700 crore extra of tax devolutions,and thiswillneedtobereturned.Revenuesfromlocalleviestoowilltakeahitduetothe lock-downandtheslumpineconomicactivityduetothepandemic.Given likelystategovernment revenues,a back of the envelope calculation shows that if they areabletoborrow4%ofGSDP,theymaynotneedtocutcapitalexpenditurebymorethan50%.Else,thecapexwouldneedtobefurtheraxed.If theyreform,however,it canbe awin-win.

ALTHOUGH MAHARASHTRA CM Uddhav Thackeray has, time andagain, leaned on ‘sons of the soil’ politics—his government evenpassed an order reserving 80% of jobs in industries for locals—hisgovernment now seems to be waking up to the harsh realities of

labour shortage.As per an Indian Express report, the state is likely consideringbringing the 80% quota down to 60% for high-tech sectors.The amendmentwouldallowindustries toaccommodate40%outsiders,asagainst20%now,forthreeyears,duringwhich,theywill train the local youth to readythemfor jobs.The relaxation is indeedwelcome,given states realise that such stanceswouldhinder their chances of attracting industry or restartwork.The problem,how-ever, is that states are still engaged in quota politics,when the focusmust shifton getting economyon track.

Besides, this kind of populist adventurism only fuels the demand for suchquotas inotherstates.Andhrahad introducedasimilarquota lastyear,andMad-hya Pradesh followedwith a 70% quota for locals, if MSMEswanted to avail ofgovernmentbenefits.Gujarat is anexampleof quotasnotworking in thepast—despitehavingan85%reservationforlocals,therea largeproportionofmigrantsinmanyindustries.Maharashtraandotherstatesneedtorelaxnormsfurthertorestart their economies,andminimumwagenormsneed to be rationalised.

That’s one of the biggest problems in this pandemic

PERHAPSTHEBESTexampleofhowlittleinformationisbeingmadeavail-ableintheCovid-19pandemicisTuesday’sbriefingbythehealthministry.InresponsetoaquestiononwhetherIndiahadenoughhospitalbedstomeettheneedsofCovid19patients—themediaisreportingdeadbodiescrowd-

ingmortuariesandpatientsbeingturnedawayfromover-crowdedhospitals—theoffi-cialmerelystatedthatthecentralgovernmenthadamodelwhichhelpedstatesplanforhowmanybeds andother facilities theyneed; not evenahint ofhowmanybedswereneededorwhatkindofshortageswerebeingseenandtheplanstorectifythis.AnICMRofficial,inresponsetoanotherquestion,saidthatIndiawasfarfromtheCovid-19peak,butneverstatedwhattheICMRestimatewasofthepeakandbywhenitwasgoingtobereached.Indeed,whileICMRhadearlierestimatedthat70-80%ofinfectedpersonswereasymptomatic,anewICMRstudy—afteroveramilliontests—suggeststhisnumberiscloserto30%;butICMRcannotsaythisforcertaineitherasthestudysaysitdoesn’thaveadequateinformationon44%oftheinfectedpersons.

While it can conceivablybe argued that the central governmentdoesn’twant togiveinformationthatmakesthestateslookbad—ifitsaid,forinstance,thattherewasabedshortageonlyinMumbai—theproblemis thestatesdon’tputoutmuchinfor-mationeither.Ideally,whatpeoplewant toknowis the typeof infrastructure—beds,ICUs,PPE,etc—that each statehas,thenumberof patients coming in everyday,theoccupancylevelsofbeds,tracingofcontactsofthosewhohaveturnedpositive,whethertheyhavebeenquarantined,etc; and this needs to be juxtaposedwith estimates ofwhat isneededattheinfection’speak.Fewstates,however,putoutsuchinformationinfull,andalmosteverystatehasadifferentreportingformat.Mumbaiputsoutdataoncontactstraced—8,864onMay29—butit isnotclearwhatthebacklogis;onApril26,Mumbaihadreportedthatjust54%ofcontactsoftheinfectedweretraced.ICMR’slateststudypointsoutthatDelhihastracedjust8.9contactsforeveryinfectedpersonandMaharashtraamere7.6versus44 inTamilNaduand149inOdisha.Littlewon-der,then,thattheinfectionspreadsofastevenduringthelockdown.

WhileMumbaiandDelhireportnumbersonoccupancyofbeds—neithergivesprojections ofwhat is required,though—fewothers do.Ahmedabad,for instance,has stoppedgiving informationonventilatorusage;Kolkatahasnodetails on thecity’s facilities that areavailable fortreatingCovid-19.Delhihasno regular infor-mationonthenumbersquarantinedsofar,andwasputtingouttwosetsofdataonthenumberofdaily tests—one in itsdailybulletinandanother in its report to theDelhiHighCourt.UttarPradeshdoesn’t havedistrict-wise data on theutilisationlevels ofvarious types of facilities. If thevirus has to be beaten,thevery least thatisrequirediscompleteinformationthatcanhelpvariousexperts—insideandout-side the government—plan forwhat is likely to be needed and to come upwithworkingsolutionswhere therearegaps.

●Write to us at feletters@expressindia.com

Opinion

Expect FY21 growth to contract by 2%

Source: BofA Global Research estimates, MOSPI, RBI, FinMin

-20.0

-15.0

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

25.0

Dec‘12

FY01 FY03 FY05 FY07 FY09 FY11 FY13 FY15 FY17 FY19 FY21E

Jul‘13

Feb‘14

Sep‘14

Apr‘15

Nov‘15

Jun‘16

Jan‘17

Aug’17

Mar‘18

Oct‘18

May‘19

Dec‘19

Jul‘20

Feb‘21

Sep‘21

Real GVA y-o-y (%)

BofAe (%)

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

FD as % of GDP LTA

FY21 center’s fiscal deficit could rise to 6.3% on falling growth

Ahmedabad

RNI No. GUJENG/2006/22183 Printed and published byHareshkumar K Bhagdev on behalf ofM/s The Indian Express Private Limited and printed at Bhaskar Print Planet, SurveyNo. 148P, Changodar-Bavla Highway, Tal. Sanand, Dist. Ahmedabad and published at 3rd Floor, SambhavHouse, Bodakdev, Ahmedabad-380 015. Phone (Board) : 26872481-82-83, Fax: 079-26873950.

Chairman of the Board - Viveck Goenka,Managing Editor - Sunil Jain, Editor (Ahmedabad): Jyotsna Bhatnagar* (*Responsible for selection of news under the PRBAct ) © Copyright: The Indian Express Private Limited. All rights reserved. Reproduction in anymanner, electronic or otherwise, inwhole or in part, without priorwritten permission is prohibited. The Financial Express®

ALTHOUGH SECURING LIFEand livelihood together is achallenging job,wisdom liesin converting challenges intoopportunities.TheModi gov-

ernment’s endeavours have been to fightthe pandemic head-on and simultane-ously support the economyfromcollaps-ing. It announced a comprehensiveAtmanirbhar Bharat package of `20 tril-lion in five tranches duringMay 13-17,includingnearly`2trillionreliefpackagegiven earlier.The Atmanirbhar packagecarries the blueprint of the government’svisionforanewIndiainthemediumterm.

The government has steadfastlyavoidedsoftoptionsso far,likemonetisa-tion of deficit/debt, transfer of RBI’sreserves/contingency funds to financestimulus package, asking RBI to open adirectwindowtofinanceNBFCs/MFs,etc.Many expertswonder as to how the gov-ernmentwould finance the `20 trillionpackage proposed in phases.While theuses of funds have been explicitly com-municated by the finance minister, thesourcesof fundsneedbetterunderstand-ing to clarifymisgivings surrounding thelarge packagewithout a commensurateriseinthegrossfiscaldeficit-to-GDPratio.

Thepackage,inpublicdomainnow,hasthreeelements—relief,rehabilitation,andrebooting of the economythrough struc-turalreforms.Thebulkofthereliefisbeingmetbycashoutgofromthisyear’sbudget,which is around 1.2% of GDP, whilesources of funds for rehabilitation andrebooting are distributed between futurerevenues of the government, the liabilityof thepublic sectorunits,andRBI.

Amajorpartoftherehabilitationpack-age is credit-led. The government hasgiven credit guarantee for `3 trillion col-lateral-free loans to MSMEs, besidesequitysupport of`40,000crore andsub-ordinated debt of `20,000 crore.This is abold decision to keepMSMEs afloat andprevent large-scale lay-offs.Also,revisionofMSMEdefinitionwouldenableawidersegment of India’smanufacturing sectorto surviveandhelp reboot theeconomy.

RBI has been generous in makingdurableliquidityavailablethroughseveralchannels likecut inCRR,OMOpurchases,long-term repo operations (LTRO), tar-getedLTRO(TLTRO),specialrefinance,SLRexemption, etc.There is scope to cut therepo rate further andmake LTRO/TLTRO

fundsavailableatacheaperrate.Giventhegrowthscenario,itmaybedifficulttohaveinvestment-gradecorporatepaperstothetuneof`8trillioninFY21.Hence,RBImayhave to change the conditionality associ-atedwith LTRO/TLTRO funds.Medium-termliquidityshouldbemadeavailableontapfordeploymentasloansand/orinvest-ment in certain proportions, such thatMSMEsarenotdeprived.

The `20 trillion package includes `8trillionliquidityinjectedbyRBI.Theexcessliquidity,which currently returns to theRBIbalancesheetasreverserepodeposits,is likely to be utilised by the beneficiariesas proposed by the finance minister assoonaslockdownconditionsareremoved.Since the RBI liquidity is essentially the

sources of funds, theAtmanirbhar pack-ageworksoutto`12trilliononanetbasis.

Partial/full creditguarantee formsthecontingent liability of the government,whichhas exceeded thepermissible limitunder the FRBMAct. In the wake of theCovid-19 pandemic, as fiscal arithmeticare unlikely to conform to the RFBMAct,there is a need to reviewtheAct anddrawa new timeline to achievemedium-termobjectivesof fiscal consolidation in India.

Part of the relief programme is beingmetbytheFoodCorporationofIndia(FCI)in the form of distribution of free cere-als/pulses.FCI-ledreliefwilldevolveonthegovernment andadd to its liability induecourse, although it is initially consideredas extra-budgetary resources.There is no

free lunch anyway.Food security being agovernmentprogramme,thegovernmenthas to foot thebill toFCI sooneror later.

Rebootingtheeconomycanbedoneintwo ways—through structural reformsand fiscal stimulus or a combination ofboth. Structural reform proposals in theAtmanirbhar package aremany and far-reaching, covering agriculture, industry,mining, infrastructure, defence produc-tion, etc.The epicentre of Covid-19 dis-ruption being the real sector, the govern-ment has towiden its structural reformsto several areas, besides continuingwithongoing reforms. In fact, the coverage ofstructuralreformsthistimeismuchwiderthan in the early 1990s.Thismay invigo-rate the economy in themedium-term if

implemented ina time-boundmanner.The Union government’s fiscal deficit

in FY21 is likely to increase from3.5% to7%ofGDP,mainlyduetoshortfall in rev-enues and disinvestment.Moreover, thelimit of state governments’ borrowingshasbeenincreasedfrom3%to5%oftheirrespective gross state domestic products,of which 0.5% is unconditional and therest is conditional.The combined fiscaldeficitmayvarybetween10.5%and12%ofGDP in FY21.As the fiscal space is lim-ited,thegovernmenthasnotbeenable togive adequate fiscal stimulus so far.How-ever,thismaybenecessary,goingforward.Unlesseconomicactivityis fullyrestored,anyfiscalstimulustoaugmentdemandatthis stage may go waste. Hopefully, thegovernmentmayconsiderfiscal stimulusatalaterstage,butlimitedfiscalspacemayconstrain this effort inabigway.

As the domestic market is unable toabsorb the enhanced government bor-rowingwithoutpushinguptheyieldrate,the governmentmayconsiderborrowingfrom abroad in foreign currency, eitherdirectly or through PSUs under govern-mentguarantee.FloatingofCovid-19tax-free bond for $15 billion in the overseasmarket,openforallnon-residents,includ-ingNRIs,maybe considered.If necessary,the governmentmay resort to borrowingunder bilateral swap arrangements for asimilar amount, besides obtaining con-cessional loans frommultilateral institu-tions like the IMF, the World Bank, theADB,and the NDB.Thiswould offset theoutflowofcapitaldue flight to safety,andsmoothenliquiditymanagementasRBI’sshort-termliquiditywindowsexpire.

OPINION 7FINANCIALEXPRESS

WWW.FINANCIALEXPRESS.COM WEDNESDAY, JUNE 3, 2020

ABHIJIT

DOSHIThe author is amedia consultant

THECOVID-19pandemichas brought into focusinherentweaknessesoftheIndianeconomy.Lackoffinancialstability,inadequatehealthcarefacil-itiesandinhumanconditionsofmigrantlabour,for example, point at policy failures at large or

tardyimplementationof somepolicymeasures.The challenges faced by the financial sector are plenty,

but largelyclear.Thebankingsystemis flushwith liquidity,but banks are unwilling to take the risk of lending.RBI cutreporatesby115bps—ontopofthe135bpscutdeliveredbytheMPC last year.Yet the extent of transmission of thesecuts bybanks leaves everyone unhappy.MSMEs are one oftheworst hit by theunwillingness of banks to reduce lend-ingrates inkeepingwith thestateof theeconomy.

A recent paper byTobiasAdrian and Fabio Natalucci onthe IMFwebsite (COVID-19Worsens Pre-existing FinancialVulnerabilities)notesthatmuchthesamewayCovid-19hitspeoplewithpre-existinghealthconditionsstrongly,soisthepandemic-triggeredeconomiccrisisexposingfinancialvul-nerabilities built upduringadecadeof extremely lowratesandvolatility.Theauthorswarnthatvulnerabilitiesincreditmarkets, emerging countries and banks could cause a newfinancialcrisis.ThisstatementhasalotofrelevancetoIndia.

The situation in healthcare is similar. India has alwaysfaced shortage of hospitals,doctors,healthworkers,medi-cines and other inputs.These shortages aremore acute inrural areas.Despite government spending and policies toassuage the shortage,anddespite the increase in thenum-berofhospitals,doctors,etc,thedemandseemstoconstantlyoutstrip thesupply.Covid-19bringsout this realitystarkly.

The issue ofmigrant labour ismore complex. India is ademocraticcountryandpeoplearemoreorlessfreetoworkanywhere. But the reality is harsh.At the level of manuallabour,theymostlymigrateforeconomicnecessity,thanoutof choice.Away fromhome and family, theymostly live inpathetic environs,andhavesmall and irregular income.

Theheart-wrenchingphotosofmigrantlabourerswalk-ingmiles to reach their villages,with old parents and chil-dren,withoutfood,moneyorshelterontheway,inthepeaksummers, are reminiscent of people crossing borders dur-ingPartition.Whilewalkinglongdistances,manydied,somebecauseoffatiguewhileothersduetoaccidents.Whocouldblamethemif theyfeel like refugees in theirowncountry?

The issueofmigrant labourpoints at abasic infirmity inoureconomicpolicies andgrowthprocess thatyield imbal-anced regional development.That leads to strange results.Considerthis:Whileworkerswanttogohome,industrialistsexpressconcerntheymaynotcomebackanditwouldbedif-ficulttofindlabourtorunfactories.Somestatesdonotwantthemtogoforsimilarreasons.It isnotthatIndiahaslimitedmanpowerintheworking-agegroup.So,whythisworry?

The lopsided development model followed for manyyearsensuredthatindustriesareconcentratedinafewpock-ets,whilemanytownsandcitieshave little industrialactiv-ities,andthereforeemploymentpotential.Thismodeldrawshordesofpeople fromoneregiontoanotherall the time.

To remedy this imbalance, the government had, in the1960s and 1970s, started incentivising industries thatwouldbesetupintheso-calledbackwardareas.Concessionswere granted in sales tax, excise dutieswere reduced, andtransport subsidieswere announced.However,a fewstateswentoverboardandcompromised theirfinances.

In post-reforms era,the emphasis shifted to infrastruc-ture development,where the governmentwas expected toplayamajorrole.Considerablegroundhasapparentlybeencoveredinroad,water,power,butalotremainstobedoneinhousing,particularlyaffordablehousing,slumdevelopmentandcleanliness.Equallyimportant,availabilityofmanpowerwithappropriate skills seemstobeahugechallenge.

The government needs to focus on thesemissing infra-structure gaps.Thatwould ensuremore balanced regionaldevelopmentandminimisetheneedforinternalmigrationforeconomiccompulsions.Hadthatbeenachieved,weprob-ablywouldnothaveseenpeopleundertakingsuchlongtripshome.Nodoubt,balancedregionaldevelopmenttakestime,but an early start even nowwould be welcome.We havewastedenough time.Sevendecades—the spanof Indepen-dent India—couldhave takenusa longway.

Easingmigrationchallenges

If infra gaps are filled, industrywilllikely prefer labour-surplus areas

Atmanirbhar Bharat:

Doing themath

BARENDRA

KUMAR

BHOIVisiting fellow, IGIDRViews arepersonal

The domestic market

can’t absorb enhanced

govt borrowingwithout

pushing up the yield

rate; the govt may

consider borrowing

from abroad

WITH THE ENTIREnation under lock-down for over twomonths,demand hasslumped. Almost

everysector,be it inservicesormanufac-turing,has reported a drastic plunge indemand. InApril, the automotive indus-tryreportednosaleswhatsoever.Someofthebiggest enginesof economicgrowth,suchasrealtyandconstruction,hospital-ity,aviation,allreportedvirtuallynoactiv-ity.Apart fromhealthcare and essentialservices,theonlyindustrythatkeptwork-ing was agriculture. This is the savinggrace because the largest chunk ofman-powerinIndiaisemployedintheagricul-turalsector.Wehaveseentherecessionof2008wheremillionswere unemployed,companieswere reluctant to invest,andfactories had fallen silent. Consumerdemandwasstagnant.But,innotime,the

demandwas gushing.Ahandful of com-panieswere doing exponentially betterthantheircompetitors.Theyenjoyedrun-away growth, premium pricing, andextraordinary customer loyalty.Compa-niesstartedgrowing,profitswererobust,and customerswere loyal because thesecompaniescontinuedbusiness.

Wemustnotover-reacttothepresentsituation and take stern decisions thateventuallybreakourbusinesses.It isveryimportant to takeabalancedview,with-outhaste.Itisimportanttobeinbusinessto ensure continuity, and we shouldretainouremployees.

So, howwill the economy soar onceagainafterthepandemic,whenthecrisisisdeeperthantheone in2008?

The economy is based on demand;Other than the necessities, demand isbased on perception. The governmenthastriedtopumpliquidityintothemar-

ket;however,it isperceivedthatdemandhasn’t come back. Demand will comeback onlywhen people feel that priceswill go up,or they assume that they aregetting anopportunity that theyshouldencash lest it ismissed.

Now,with the government pushingforliquidityandaskingbankstolend,willthisnotbringtheeconomybackontrack?

Liquiditywillhelp industrytomanu-facture, but if industry doesn’t seedemand,itwon’tproduce.

Demand generationThegovernmenthasbeencomingup

witha lotofmeasures;however,wemustagreewiththefactthatforaneconomytorevive,demandshouldbethere.Reformsshould be framed in such amanner thatthe industries are supported, so thatemployment continues. If employmentcontinues,purchasingpowerwill be sus-tained. It is cyclical.Moneyneeds to rotate in themar-ket, which is crucial. Oncethe government starts ‘giveandtake’,thereareimmensepossibilitiesforrevivingtheeconomy, and the govern-ment will earn more rev-enue than it has to give up.Banks are averse to lendinginthisgloomyeconomy.Thegovernment, in consulta-tionwith banks and indus-try, should structure rela-tionsinsuchamannerthatitislenientforall andinbenefitofgeneralpublic.

RBI has created a perception that itwill supportmutual funds,and the gov-ernment has given an assurance bywayof guarantee to banks.Here, banks andthe government together have toworkforthesamegoal.

TheInsuranceRegulatoryandDevel-opmentAuthority (IRDA) is aggressivelythinking of reviving its credit insurancebusiness. This will definitely help thebanks,which will be safeguarded and,thus, encouraged to lend. The govern-mentismakingalotofeffort,butmoneyis not reaching the people on the streetandpurchasingpowerisn’t goingup.

Consider our two major industries:construction/realestateandautomotive.Construction/real estate: Banks

mustformaschemeforrealestatewheretheygive loans for35-40years,with2-3

yearsmoratorium.Here,RBIsupportwillbe required for giving loans for 35-40years as there will be no matchingdeposits that bankswill have.Currently,interest rates are already very low andthere is no need to reduce. Based on aready-reckoner rate, banks should giveloans. In affordable categories, banksshouldnotaskformorepapers,butmustget contribution from homebuyers orassurance from developers that bankswill not be left in the lurch. Only pre-approved projects should be funded sothatbanksdonot takeanyhaircut.How-ever,bankloansonEWScategoryshouldbe considered as priority sector lending.The governmentwill get GST on inputmaterial. Per square feet, at least `300will go towards GST. There is a hugeunmet need in this segment,and acrossIndia, 100 crore sq-ft constructions,which translate into20 lakhhouses,willbe consumed in the next 2-3 years.Thegovernmentalsowillearnadditional5%GSTonsaleoftheseflats,whichwillagainbe about `300-400 per sq-ft. If the gov-ernment gives time to homebuyers topayGST of 5%within five years in fiveequalinstalmentswith7%interest,thenitwillbeagreathelptohomebuyers.Sucha scheme should bemade available for6-9 months. In case homebuyers areunable to repay to the bank,then a bankcanmonetisetheasset,oradeveloperwillcompensate to the bank.The real estatesector has a lot of NPAs. If the govern-ment pusheswork,bankswill be able tomonetise their outstanding receivables.People intheretail segmentgenerallydonotdefaultunlesstheyarejoblessorfaceanyothercritical/unavoidablereason,asinIndiaself-respect inthecommunityisvaluedmore thananythingelse.Automotive: Similarly, in the auto-

mobile industry, there can be newbankloanswithmarginsof25-35%,andbanksmust give loans up to `2.5-3 lakh. Itwillhelpsalesofsmallcars,two-wheelersandlightcommercialvehiclespickup.Inthiscase,carmanufacturersmust give FLDG(first loss default guarantee) orwill buy-back a vehicle from banks,where bankswill not make any loss. In such a case,automobile manufacturers and banksboth are protected.Easy loanswill helppeople buyvehicles as public transportwill likelybeavoided.Automobilemanu-facturers should develop attractiveschemestopushdemand.

If the government gives a waiver oftax onpayment of interest forpurchaseof a house or a vehicle, it will bewidelyaccepted by the borrowers andwill pro-pel demand.

Labourershavemigrated,and insuchascenariotherevivalofrealestate seems gloomy.A lotof action has been takenand labour lawsaregettingreformed. Now, 12-hourworkingshiftsshouldstart.Everyonemust contributetowardseconomicdevelop-ment, and extra labourmust be provided with asuitablepaypackage.More-over,thegovernmentmustcomeoutwithanorderthatall the workers have to

report on a particular restart date orwithin30daysofarestartdate.If theydonotreport,actioncanbetaken.

The real estate and the automobileindustry have more than 350upstream and downstream linkages.Any revival here will release a cascad-ing streamofbenefits inall other inter-linked segments. As a result, myriademployment and entrepreneurialopportunities will be generated, andthiswill be key indriving a faster turn-around of the Indian economy. Theprimeminister’s ambitious vision of aself-reliant India, or AtmanirbharBharat,will thenbecomeagroundreal-ity sooner rather than later.

Everyonehastoworktoovercometheeconomiccrisis.Thegovernmentisasav-iour, but it alone cannot solve all theproblems of the people.All of us Indiansneed tocontribute towards this.

Revivingdemandis key

The real estate and the automobile industry have

more than 350 upstream and downstream linkages.

Any revival herewill release a cascading stream of

benefits in all other interlinked segments

●THE INFRALINK

The author is on the board ofThe InvestmentTrust of India Ltd.Views are personal

● REVIVING ECONOMY

IRDA is thinking ofreviving its creditinsurance business.Thiswill definitelyhelp banks,whichwill be safeguardedand so theywill beencouraged to lend

SUDHIR

VALIA

ILLUSTRATION:ROHNITPHORE

Ahmedabad

●CONGRESSIONALREPORT

ASSOCIATED PRESSWashington, June 2

THE CONGRESSIONAL BUDGETOfficesaidMonday that the US economy couldbe $15.7 trillion smaller over the nextdecadethanitotherwisewouldhavebeenif Congress does not mitigate the eco-nomicdamage fromthecoronavirus.

The CBO,which had already issued areport forecasting a severe economicimpactoverthenext twoyears,expandedthat forecast to show that the severity oftheeconomicshockcoulddepressgrowthforfar longer.

The new estimate said that over the2020-2030 period, total GDP outputcouldbe$15.7trillionlowerthanCBOhadbeen projecting as recently as January.Thatwould equal 5.3% of lost GDPoverthecomingdecade.

After adjusting for inflation,CBO saidthe lost outputwould total $7.9 trillion,alossof3%of inflation-adjustedGDP.

CBO called this a “significant mark-down”inGDPoutputasaresultofthepan-

demic. The CBO is forecasting that theGDP,whichshrankata5%rateinthefirstthree months of this year, will fall at a37.7%rateinthecurrentApril-Junequar-ter,thebiggestquarterlydeclineonrecord.

“Lastweekwe learnedthatover40mil-lionAmericans lost their jobs as a result ofthis horrific pandemic,” Schumer andSanderssaidinajointstatement.

“Today, the CBO tells us that if currenttrendscontinue,wewillseeajaw-dropping$16trillionreductionineconomicgrowthover the next decade.” Schumer andSanders said Republicans should stopblockinglegislationtoprovidemoreassis-

tance given that 40millionworkers havelost their jobsalready.

“In order to avoid the risk of anotherGreat Depression, the Senate must actwith a fierce sense of urgency,”SchumerandSanders said.

The CBO also issued a separate reportdetailingacostestimatefora$3.4trillionCovid-19 rescue bill that passed theDemocratic-controlled House in mid-May.That legislationisbuiltaround$915billion in aid to state and local govern-ments, another $1,200 payment tomostAmericanworkers, and additional aid tocollegesand local schooldistricts.

REUTERSJune 2

GILEAD SCIENCES IS developing easier-to-administer versions of its antiviraltreatment remdesivir for Covid-19 thatcouldbeusedoutsideofhospitals,includ-ing ones that can be inhaled, after trialsshowed moderate effectiveness for thedruggivenbyinfusion.

Remdesivir is the onlydrug so far thathas been shown to help patients withCovid-19,butGileadandothercompaniesarelookingforwaystomakeitworkbetter.

For critically ill patients,Roche andEliLillyandCoare testingdrugs incombina-tionwith remdesivir.

Gilead is also seeking to treat thevirusearlier.Otherantivirals,like influenzapillTamiflu,work bestwhen given as early aspossibleaftersomeonebecomesinfected.

GileadinastatementonMondaysaiditis lookingatways touse remdesivirearlierinthecourseofdisease,includingviaalter-nateformulations.Thecompanyconfirmed

inanemailthatitisresearchinganinhaledversion,butdeclinedfurthercomment.

Company executives such as Chief

Medical OfficerMerdad Parsey and ChiefFinancial OfficerAndrewDickinson havebeen doing interviews with Wall Streetanalysts in recent weeks to discuss theplans,whichare inearlystages.

Theyhave said that in the longer term,the company is exploring a subcutaneousinjectionformulationofremdesivir,aswellas dry powder versions to be inhaled.Remdesivircannotbegivenasapillbecauseit has a chemical makeup that woulddegradeintheliver,andtheintravenous(IV)formulationisonlyusedbyhospitals.

In the short term,Gilead is studyinghowitsexisting IVformulationof remde-sivircanbedilutedforusewithanebuliser—adrug deliverydevice used to adminis-ter medication in the form of a mistinhaled into the lungs.

The idea is thatanebuliserwouldmakeremdesivirmoredirectlyavailabletoupperairwayandlungtissueasthecoronavirusisknown to attack the lungs. It would alsoallow for early treatment of coronaviruspatientswhoarenothospitalised.

Gilead’s next step: inhaled remdesivir,other easier-to-useversions of drug

CBO report projects GDPfalling at 37.7% rate in thecurrent April-June quarter

French economy toshrink 11% in 2020,more hard days aheadTHEFRENCHECONOMYis set tocontract11%thisyeardue to thecoronaviruscrisis andmoreharddayslie aheaduntil thingsbouncebacknextyear,FinanceMinisterBrunoLeMaire saidonTuesday.Franceimposedoneof theEurope's strictestlockdowns inmid-MarchandonlybeganremovingrestrictionsonMay11.Cafes,barsandrestaurantswereonlyallowedto reopenforregularbusinessonTuesday.

VWto install Porsche CEOas brand chief: ReportVOLKSWAGENCEOHERBERTDiesswillpromotePorscheCEOOliverBlumetobecomeheadoftheVWbrandaspartofabroadermanagementreshuffle,AutoMotorundSportsaidonTuesdaycitingcompany.BlumewillbemovedtotheVWbrandtohelpthecompanygetagriponproductionissueswiththeVWID3electriccarandtheGolf8,theautoindustrypublicationsaidTuesday.

EU balks at adding Russiaback into G7THEEUROPEANUNIONviewstheGroupofSevenformatasavitalmultilateral frameworkthatcannotbechangedonapermanentbasisbythechairofthegroup,currentlytheUnitedStates,anEUspokesmansaidonTuesday.USPresidentDonaldTrumponSaturdaydismissedtheG7asa“veryoutdatedgroupofcountries”andsaidhewouldexpandthelistofinviteestoincludeAustralia,Russia,SouthKoreaandIndia.RussiawasejectedfromthegroupafterannexingCrimeafromUkrainein2014.

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Court rulingpaveswayfor $10billionper yearofclaims againstVW

InternationalFINANCIALEXPRESS8 WWW.FINANCIALEXPRESS.COM

WEDNESDAY, JUNE 3, 2020

AGENCIESJune 2

ATLEASTFIVEUSpoliceofficerswereshotandwoundedduringviolentprotestsoverthedeathofablackmaninpolicecustody,police andmedia said,hours after Presi-dent Donald Trumpvowed to deploy themilitaryifunrestdidnot stop.

TrumponMondaynightcalledongov-ernors and mayors to “dominate thestreets”andannouncedthathewassend-ing thousands of heavily armedmilitarypersonnel into the nation’s capital afterdays of violent outbursts following thedeath of George Floyd,an unarmed blackman,at thehandsofMinneapolispolice.

Thecommentsprecededanothernightof sometimes-violent unrest in US cities,including New York, where looting andarrestscontinueddespiteacurfew.Macy’siconic flagship store on 34th Street wasamong the businesses breached, accord-ing to theAssociatedPress.

After speaking,Trump took an unan-nouncedwalk across the street from theWhiteHouse throughLafayetteSquare—with tear gas hanging in the air that hadbeen used to clear away protesters — tovisit Saint John’s Episcopal Church.Thehouse ofworship,known as“The ChurchofPresidents,”hadbeendamaged ina firethe previous night, as police and protest-ers clashed in thestreetsofWashington.

Atthechurch,TrumpheldaBiblehehadbrought from theWhite House in the airand gathered top aides to pose forphotos.“Wehavethegreatestcountryintheworld,”Trumpsaid.“We’regoingtokeepitsafe.”

Twitter suspendshundreds tweeting

Twitter suspended hundreds ofaccounts associated with spreading afalse claim about a communications

failure during protests inWashington.The action was part of an active

investigation into the #dcblackouthashtag, according to a Twitter repre-sentative on Monday, who cited thecompany’s policyprohibiting spamandplatform manipulation. It is the latestexample of Twitter cracking down oncontentviolations sinceprotests startedlast week after the death of GeorgeFloyd, an African-American man,whilein police custody.

THE NEWYORKTIMESJune 2

VOLKSWAGEN, THE GERMANautomakerthatadmittedtoadecade-longscheme to cheat ondiesel emissions testsin theUnited States and elsewhere,couldfacea“staggering”volumeofclaims fromlocal governments after a federal appealscourt ruled onMonday that counties inFloridaandinUtahcouldimposelocalpol-lution lawsonthemanufacturer.

Together,the twocountieshadsoughtpenaltiesof$5,000adayforexcess emis-sionsfromatleast6,000Volkswagenvehi-cles fittedwith the cheating device— anamount that adds up to more than$10billionayear.

Volkswagen has already paid morethan $20 billion in federal criminal andcivil penalties aswell asother legal settle-mentsaftertheEnvironmentalProtectionAgencyaccused it in2015ofusing illegalsoftware toconcealpoisonousemissions.

Those include settlements in lawsuitsbroughtbyconsumersrelatedtoitssaleofabout 600,000 diesel cars equippedwithdevices that illegally circumventedemissions tests.

But those settlements did not releaseVolkswagen fromclaimsbrought by localgovernments, some of whom have

brought their own suits against theautomaker, a panel of the United StatesCourtofAppealsfortheNinthCircuitsaidinaunanimous ruling.

Volkswagen argued that the CleanAirActpre-emptedthosecounties’claimsandthat the company— aswell as Audi andPorsche,subsidiariesthatarealsoaccusedof cheating— should be regulated solelybytheEPAonthematter.

Thecompanysaidinastatementthatit“respectfullydisagrees”with the ruling.

❝ ❝

EXPOSING INEQUALITIESMichelle Bachelet, UN human rights chief

This virus is exposing endemic inequalities that havetoo longbeen ignored. In theUS, protests triggeredby the killing ofGeorge Floyd are highlighting notonly policeviolence against people of colour, butalso inequalities in health, education, employment...

Nonewcoronacases,but300asymptomatic,after citywidetests inWuhan

EU’s top diplomat: Floyd’sdeathwas abuse ofpowerTHE EUROPEAN UNION’StopdiplomatsaidthedeathintheUS of an unarmed blackman at the hands of policewas “an abuse of power” asofficials across the continentexpressed concern at theensuingunrest.

EU foreign-policy chief

Josep Borrell said the 27-nationblocwas“shockedandappalled”byGeorge Floyd’sdeath in Minneapolis andvoiced“trust in the abilityofthe Americans to cometogether, to heal as a nationand to address these impor-tantissues”.—BLOOMBERG

Asia called onto coordinatepolicies toAvertglobal slump

JOE BIDEN CASTIGATEDTrump onTuesday for fan-ning“the flames of hate”asheseeks toreassureanationonedgefromdaysofprotestsaroundthecountrythathaveled the president to call formilitaryintervention.

“This president today is

part of the problem andaccelerates it,” Biden said,adding that Trump is “con-sumed” with his blindingego.“Look,thepresidencyisa big job. Nobody will geteverything right,” Bidensaid.“Iwon’t fan the flamesofhate.” —AGENCIES

REUTERSHong Kong, June 2

HONG KONG LEADER Carrie LamaccusedforeigngovernmentsonTuesdayof“double standards” in their reaction toBeijing’splanstoimposenationalsecuritylaws on the city, pointing to anti-policebrutalityprotests in theUnitedStates.

“In the US,we see how the riots werebeing handled by the local governments,compared to the stance they adoptedwhen almost the same riots happened inHongKong lastyear.”

In her first public appearance afterWashington said it will remove HongKong’spreferentialtreatmentinUSlawinresponse to Beijing’s plans, Lamwarnedcountries threateningactionsagainst thecitythattheymayhurttheirowninterests.

Having lost patiencewith Hong Kong

after large-scale and often-violent pro-democracy protests in the Chinese-ruledcity last year, Beijing authorities lastmonth advanced plans to introduce lawstackling secession, subversion, terrorismandforeign interference.

“They are very concerned about theirownnationalsecurity,butonournationalsecurity...theylookthroughtintedglasses”Lamtoldaweeklynewsconference.

REUTERSBeijing, June 2

THECHINESECITYofWuhan,where thenovel coronavirus outbreak began, hasfound no new cases of people sufferingfrom Covid-19 after testing almost itsentirepopulation,and300asymptomaticcarriers of the virus, officials saidonTuesday.

Authorities launched the vast testingcampaignonMay14,andreached9.9mil-lion out of 11millionpeople,after a clus-ter of new cases raised fears of a secondwaveof infections.

China does not count people whoare infected with the virus but do notshow symptoms of the disease asconfirmedcases.

Officials told reporters in a briefingthat there had been no new confirmedcases,andsaid theasymptomatic carriershad been found not to be infectious;masks, toothbrushes, phones, door han-dles and elevator buttons that theytouchedhadnotracesofvirus.

The central city, capital of Hubeiprovince,wasplacedunderalockdownonJanuary 23.Itwas liftedonApril8.

BLOOMBERGJune 2

COORDINATIONAMONGASIANnationsis key to steering the global economytowardrecoveryfromthecoronaviruscri-sis, according to former senior govern-mentofficialsandacademicsintheregion.

Asian leaders shouldhold a summit toarrange financial,trade,public health andfoodsecuritypolicies,according toa strate-gic plan released Wednesday by the Aus-tralianNationalUniversity.Thegroupbehindthe initiative includes advisers to the gov-ernmentsofChina,Japan,Indonesia,India,Singaporeandothers,thestatementsaid.

“Withoutinternationalcooperationandcoordination,theworldisfacingaprolongedhealthcrisisandlastingeconomicstagnationona scalenot seen since theGreatDepres-sion,”said co-authorPeterDrysdale of theANU’sAsianBureauofEconomicResearch.

PANDEMIC FALLOUT■ The virus impact could equal 5.3%of lost GDPover the coming decade

■After adjusting for inflation, lostoutputwould total $7.9 trillion

■CBO also issued a separate reportdetailing a cost estimate for a $3.4trillion Covid-19 rescue bill

■ Recent drop in energy prices isprojected to severely reduce U.S.investment in the energy sector

USeconomymayshrinkby$15.7 trillion overa decade

Two counties sought penalties of$5,000 a day for excess emissionsfrom at least 6,000Volkswagen

vehicles fittedwith thecheating device

BLOOMBERGBerlin, June 2

GERMAN CHANCELLOR ANGELAMerkel’sefforttobrokeracompromiseona second stimulus package for Europe’sbiggest economy is likely to drag intoWednesday,as the two sides in the rulingcoalitionstruggletobridgedifferencesonawide rangeof issues.

The Merkel administration hadlaunched an initial shot of stimulus andguarantees in March to cushion con-sumersandbusinessesfromtheimpactofthe outbreak.Nowofficials will focus ontrying to bring the economyback from acontraction expected to exceed 6% thisyear, the deepest since the aftermath ofWorldWarII.

Yet as talks got underway Tuesdayafternoonbetween theChristianDemoc-ratic-ledblocandtheSocialDemocrats in

hercoalition,thenumberofproposalsandremaining differences looked daunting.Themeetingisnowlikelytobreakatnightand resume following the government’scabinetmeetingonWednesday,partyoffi-cials frombothsides said.

Proposals tokick-start theailingecon-omyfromthevariousministriestotalover60 pages and exceed 100 billion euros($111billion),according to a personwithknowledgeof thematter.

Controversial proposals include debtrelief for struggling municipalities andcashbonusestostimulatecarsales.FinanceMinisterOlaf Scholz alsowants to extenda statewage-support program,known inGerman as Kurzarbeit,and to introduce afamilybonusof300eurosperchild.

Both sideswill have to narrow the gaponhowtofinancethepackageandonhowto bail out communities strugglingwithevaporatingtaxrevenue,theofficial said.

HK leader takes dig at US,calls out ‘double standards’

DELIVERYMECHANISM

■ Remdesivir can’t be given as apill as it has a chemical makeupthatwould degrade in the liver

■Gilead is studying how itsexisting IV formulation ofremdesivir can be diluted for usewith a nebuliser

Merkel partners haggleover $111-bn stimulus

Trump threatens to use troops asfive police officers shot in protests

Riot police chase aman as they rush protestors to clear area for PresidentTrumpto be able towalk through for a photo opportunity in front of St. John'sEpiscopal Church inWashington REUTERS

Biden castigatesTrump forfanning ‘flames ofhate’

Cases top

6.3millionDeaths over

Recoveries

376,000

2.64million

MAPPINGTHEVIRUS

Francewon’t raise taxes evenwith theeconomy suffering a deeper recession thanpreviously expected because of thecoronavirus lockdown, FinanceMinister BrunoLeMaire said.

Wholesales of cars aswell as commercialvehicles such as light trucks probably increasedabout 12% to 2.14million units lastmonth, theChinaAssociation ofAutomobileManufacturerssaidTuesday, signaling a recovery in theworld’slargest carmarket is gathering pace.

Lufthansa ismaking it compulsory for peopletowear facemasks on its flights fromJune 8,according to a statement. Passengersmustwear themaskswhenboarding, during theflight andwhen leaving the aircraft. Exceptionswill bemade for children under the age of6and for health reasons.

Tokyo issued an alert to residents for the firsttime urging additional caution against thepandemic, after a spike in newcases.There

were 34 new infections in the Japanese capitalonTuesday, themost in a single day inmorethan threeweeks.

Iran’s daily number ofnewcoronavirus casesedged up to 3,117 from2,979 onMonday,bringing the total known infections to 157,562.The death tally rose to 7,942with 64moredeaths in the past 24 hours.

The head ofQatarAirways called on theworld’stwomajor planemakers to ease demands thatailing carriers accept delivery of newaircraft,saying their future relationshipwas at stake.

No-deal Brexit threat loomsover pandemic-ravagedUK

Wall Street sendswine,masks to clientswithsteakhouses closed

Trump’sWHOexit threatens polio, tuberculosis efforts

SouthKorea plans $28billion outlay in third extra budget

Germany furloughs reached record 7million inMay

Russia Covid-19 recoveries exceed newcases

World Bank says coronavirus to leave 'lasting scars'on developingworld

Ahmedabad

SUDHIR CHOWDHARY

MARICO INNOVATION FOUNDATIONrespondedtothegrowingseriousnessofthe Covid-19 pandemic with ‘Inno-vate2Beat Covid’—a nationwide grandchallenge to unearth innovations thatcancombattheshortageofpersonalpro-tective gear (PPE) and ventilators.Thepragmatic call tohelp frontlineworkersspurred action among innovators; adetailedevaluationandduediligenceofentries led to three innovations thatemergedasfrontrunnerswiththeiringe-nious PPE solutions. Harsh Mariwala,founder ofMarico Innovation Founda-

tionandchairmanofMaricosaid,“Thesethree organisations have created prod-ucts that are innovative, are of superiorquality, can be procured at very afford-able price and have the potential toachieve significant impact – and this isexactlytheneedof thehour.”

We take a look at the products

developedbythesethreeventures:

CREAWorldwide (`41 lakh grantreceived )

One of the fewplayers in themarketoffering a breathable yet hydrophobicPPEkit,CREAoffersmedical practition-ers and frontline workers relief fromdehydration that occurs on using lami-natedPPEkits.CREAis usingnon-lami-nated fabricswhichmakes its coverallsmorebreathable;thesecanbeusedupto12 hours even in summer heat. Pricedsimilar to non-breathable kits andwithtwicethelife,CREA’sbreathablePPEkitshold the potential to halve the PPE-kitexpenditure incurred by hospitals perdoctor per day. With peak summerapproaching,dehydration is a key con-cern and CREA’s kits are poised to solvethis problem for a large number of ourfrontlineCovid-warriors.

Log 9Materials (`76 lakh grantreceived)

It hasdevelopedauniquemulti-focal

UV disinfection chamber (called Coro-naOven)thatcansanitiseanysurfaceofallpathogens in only10minutes,thus per-mittinghospitals to re-usemasks,glovesand other PPE. Each microwave-sizedcompact chamber (33-litre) candisinfect40 masks per hour, thus holding thepotentialtonotonlylargelyreducethecur-renthighpressureonPPEsupply,butalsomassivelycutdownonPPEwaste.Injustamonth sinceCoronaOven’s launch,Log9has already sold 300+ ovens,which canhelp users disinfect and re-use up to 30lakhgloveseverymonth.

Saral Design Solutions (`40 lakhgrant received)

Saral has innovated to cost-effec-tively adapt its patented sanitary padproducing machine to manufacturehigher quality 3-ply surgical masks (asopposed to commonly available 2-plymaskswhich do not protect against theCovidvirus).Saral canmanufacture at arapidrateof80maskseveryminute,andismaking thesemasks available to con-sumers at a frugal cost. Saral’smachinehas already produced 10 lakh maskssince the pandemic began. It plans torampup production through itsmanu-facturing capabilities in 20 locationsacross tierII and III cities in India.

SAJANCKUMAR

DURING THE LOCKDOWN phase insomeof theworst affected regions,manyCovidhelpline systems simplycollapsedundertheburdenofhundredsofcallsfromall corners. That’s when an innovativebunchof startups swung into action andformed anAction Covid-19 team.ThuscameaboutProjectStepOne,formedby21startupsincludingFreshworksandOzone-tel;atelemedicinecollectiverepresentingoneofthe largestnumbersofnationwidevolunteerdoctors to augment state gov-ernments’ helpline numbers. StepOnenowisanempanelledpartnerfortelemed-icineconsultationson AarogyaSetuMitr,anancillaryserviceontheAaroyaSetuappthat enables free tele-consultation forthosewithCovid-19-likesymptoms.

Rahul Gupta, one of the key teammembers at StepOne, said, “In MarchwhenweideatedStepOne,oursimplemis-

sionwas to keeppeople at home,to sup-port them inovercoming their fears anduncertainties with regard to Covid-19symptoms.Thanks to the team’s stronghealthcarebackgroundweunderstoodtheimmediateneedtosafeguardourdoctors.Tele-screeningisthefastestandphysicallythemost distancedway to identify sus-pectsandguidethemtoself-isolatesothatthey don’t infect more citizens or ourhealthcareworkers.StepOne is an inclu-sive solution thatworks across geogra-phies and is device agnostic; citizens cancallusfromfeatureorsmartphones.”

StepOne operates in seven statesincluding Karnataka, Punjab,Maharashtra, Odisha, Chattisgarh,Madhya Pradesh, and Nagaland. TheIVR has been localised for every stateand is currently live in English, Hindi,Kannada, Marathi, Odia, Punjabi andNagamese. In the last sevenweeks overonemillion calls have been triaged,and70,000 tele-consults undertaken by6,000 plus verified doctors. Theconsultations have led to theidentification of over 3,000 high-riskpatients, upon whom the respectivestate governments have takenappropriate action.

The StepOne telemedicine initiativeiscompliantwithIndianCouncilofMed-icalResearch(ICMR)automatedtriagingprotocol.The helpline records citizens’inputs on symptoms and travel history,assigns a priority flag based on which

theygetacallback from thedoctor poweredthrough cloud tele-phony. StepOne hasalso set up the technol-ogyback-endformentalhealth helplines in thestatesofPunjab,Odisha,and Karnataka. Due tohigh anxiety levels andmental traumaowing tochallenging economicandhealthconditions,get-ting access to sound coun-sellingisrecognisedasavitaltool forcitizens.

Gireesh Subramaniam,VPof productmanagementatFreshworks,said,“Fresh-works is proud to be part of ProjectStepOne as state governments and techcompaniespartnerto formthebackboneof this importantwork—helping Indiansstay safe and healthy during the pan-demic.We are gratified by the contribu-tions from our team members who attimeshaveputin18hoursadaytoensurethat StepOne initiatives are helping asmanypeopleaspossible.”

StepOnewas the firstCovid-19com-bat project to get a grant from theACTFund, set up byvarious venture capitalfirms and entrepreneurs to support ini-tiatives fighting against Covid-19. Itreceived a grant of `25 lakh fromACTandamatchingcontributionfromOmid-

yarNetwork India.The funds are beingallocated to cover infrastructureexpensessuchastelecom,andservers.

C Chaitanya, CIO of Ozonetel, said,“StepOnehasshownwhatispossiblewhenyou can leverage thepowerof collabora-tionofthebestofthebrainsintheecosys-tem.Evenworking remotely is not a con-straint.Thoughmanyintheteamcompetefor the same customers,for the country,everyonecametogether.”

On similar lines,Meera Iyer,CMOofMedlife, remarked:“We are delighted tobe part of this initiative that is helpingIndia be safe.Partnerships like this helpus achieve ourvision andwe getmoti-vatedmore by the real differencewe areable tomake.”

Project StepOne powersstate helpline numbersthrough a scalablenetwork of existing cloudtelephony,queuingsystems and a networkof doctors on call

● SPURRING SOLUTIONS

Innovation thatmattersMarico InnovationFoundation gives `1.57crore in grants to threeinnovators for creatingingenious PPE solutions

● FIRSTRESPONSE

Fighting theviruswithtech and teamwork

eFE

PersonalFinance

SAIKATNEOGI

ATATIMEwhenReserveBankof Indiahasstopped the government of India 7.75%(taxable) bonds and the country’s largestlender, State Bank of India, has reducedinterest ratesonfixeddeposits (FD)ofonetolessthantwo-yeartenureto5.1%—a17-year low—risk-averse debt-orientedinvestorswillhaveto lookat longertenureto earn higher returns. Investorswill nowhave to look at variousways to reduce thereinvestment risk and calculate the post-taxreturnsbeforeinvesting.Herearesomefixed income investment options to earnhigherinterest rates.

Fixed depositsWhile banks have been slashing FD

rates, the government in April too hadslashed small savings rates by up to 140basispointswitheffectfromthefirstquar-terof2020-21.Evenaftertheinterestratecutinsmallsavings,theschemesstilloffer

higherrates thanbankdeposits.While theinterest rate for five years and up to 10yearstermdepositsofSBIis5.4%,therateof 5-yearpost office timedeposit is 6.7%.As returns are taxed,post-tax the returns(at 31.2% tax rate) of SBI deposit will be3.72%and thatofpost-officedepositwillbe4.61%.So,onecanlockininvestmentinsmall savings at a higher rate nowbeforerates fall further.

Public Provident FundPublic Provident Fund (PPF) is one of

themost popular investment options forindividuals because of high tax-free rates—ithasexempt,exempt,exempttaxstruc-ture—and carries no risk.At 7.1%currentinterest rate, it gives an effective yield of10.32% if Section 80C tax exemption isavailed at 31.2% tax rate.At 20.8% taxrate, the effective yieldwill be 8.96%.So,those in the high tax bracket can use PPFforaccumulating long-termcorpus.How-ever,ratesofPPF,likeallothersmallsavingsschemes, are revised every quarter. Thematurityperiodis15yearsandtheaccountcanbe extendedwithin oneyearofmatu-rity forblock of fiveyears.Even thematu-rityvalue can be retainedwithout exten-sionandwithoutanyfurtherdeposits.

EPF andVPFFor salaried employees, Employees’

ProvidentFund(EPF)isanidealwaytosavefor long-term goals provided the sub-scriber doesn’t withdraw the corpus at

everyjobchange.Investment inEPFgetsatax break of `1.5 lakh under Section 80C,the interestearnedis taxfreeandthefinalwithdrawalafterretirementisalsotaxfree.The retirement bodyhas decided to pro-vide8.5%interestrateonEPFdepositsfor2019-20, which is one of the highestamongallfixedincomeinstruments.How-ever, the rate has to be ratified by thefinanceministry.

Employees have the option to increaseallocation throughVoluntary ProvidentFund(VPF)andearnthesameinterestrateofferedonEPF.Thevoluntarycontributioncanbeup to the full basic salaryanddear-nessallowance.So,at8.5%interestrateforEPF/VPF,the effectiveyield if Section80Cbenefit is also availedwill be 12.35% forthose at 31.2% tax bracket.At 20.8% taxbracket,theeffectiveyieldwillbe10.73%.

Bharat Bond ETFThesecondtrancheofBharatBondETF

maturinginApril2025andApril2031willbe rolled out in July by Edelweiss AssetManagement Company. It will invest inAAAratedpaperofstate-ownedcompaniesand the ETFwill hold the bonds tillmatu-rity.The credit risk in Bharat Bond ETFs isnext tonil.As on June1,2020,theyield tomaturity for the bonds issued in the firsttranche forApril 2023 andApril 2030 is5.76%and6.84%,respectively.

Joydeep Sen, founder,Wiseinvestor.in,saysBharatBondETFcombinesgoodport-foliocreditquality,portfoliomaturityrun-down thereby reducingvolatility risk andsecondarymarketliquidity.“Tobenoted,atthe date of investment, the remainingmaturity of the product should bemorethanthreeyears,toavail of long termcap-italgains/ indexationbenefits,”hesays.

Tax-free bondsTax-free bonds listed in the stockmar-

ketmakeswiseinvestmentasinvestorscanlock-intheircapitalforalongertenureandearntax-efficientreturns.Whilethereis notax exemption under Section 80C, theinterest accrued is completely tax-freeunder Section 10(15)(iv)(h).These bondsare frompublic sector companies such asIRFC,PFC,NHAI,HUDCO,REC,NTPC andNHPC. While the interest payments onthese bonds are tax free, therewould becapital gains tax if an investor sells beforematurityataprofit.

● FIXED INCOME

THE FIRSTQUARTERof2020witnessedabloodbath on the bourses.Fromahigh of41,952onJanuary14,2020,thestockmar-kets plummeted to a 39-month low of25,981onMarch23,2020.ThelasttimetheBSESensexhadbeen at a similar levelwasDecember26,2016,afterwhich therehadbeenasteadyandsecularlongtermuptrend.

Shouldinvestorsbeworried?Yesandno.Let’sanalyse.

Psychologyof themarketsThereareafewunassailabletruthsabout

stockmarkets.First,theyaremostlydrivenbyhumanpsychology.Notwithstandingtheuse of computing muscle in algorithmictrading,stock prices are driven byhumangreed,fear,andexpectation.

Second,stockmarketsfactorinfutureorexpectedchanges inbusinessandsociopo-liticalenvironment,ratherthanpastdevel-opments.Forboth theabove reasons,stockmarketmovementsarenotentirelyrational.However,thereisamethodtothemadness.

Third,declinesordowntrendsaremuchsteeper thanuptrends.That is somethinginvestors should expectwhen theysee themarketstumbling.

What’s themarket doing todayLet us see what the Sensex has been

doing.The last timewe sawsuchaprecipi-tousdropwas in2008when it lost around60%of its uptrend gains in ayear’s time.Thiswasafterithadtakenaround4.5yearsto reach around20,800during a bull runthathadbeguninMay2003.

Typically,after everymajorbull run oruptrend, the Sensex enters a ‘downtrend-and-recover’cyclewhere the downtrend-and-recoverperiodwouldbe roughly two-thirds of the uptrend period. Thedowntrendperiod,in turn,is roughlyone-thirdofthedowntrend-and-recoverperiod.Duringthedowntrend,theSensextendstoshedaround60%ofthegainsmade intheprecedinguptrend.

What should an investordo?First, do not panic and convert paper

lossestoreallossesbysellingyoursharesjustbecause theircurrentprice levelsarebelowcost.Analyse themarkets and studyyourinvestmentgoals.TheSensexclosedMayat32,424 and ison anuptrend.Itisexpectedtohit a resistancelevel of around35,000 in thenext twomonths or so,before revers-ing into adowntrendwith a supportlevel of around25,000byyearend. Depend-ingonvariousfactors,theremaybeanothercycle of uptrend and downtrend hittingresistance and support levels of around30,000and20,000respectively,afterwhichthenextmajorbullrunmaycommence.

So, if you are a long-term investorwhostarted investing anytime in the last fouryears,donotsellyourholdingsunlessthereisanemergencyandcashinhandispriority.You are betteroffwaitinguntil the Sensexrecovers to its January2020levels,which itmayin3-4years’time.

Ifyouareamediumterminvestorlook-ingtoexitthemarket,keepaneyeonmarkettrends and sell on thenext uptrendonly ifmarketpriceisabovecost.

Ifyouare lookingto invest,youmaynotgetabetteropportunity.Youcantimeyourbuysinthenextoneyeartocoincidewiththedowntrend-to-uptrend reversals,orwhenthemarketshavebottomedout.

Remember that the above are onlyguidelinesbasedonexpectedmarketmove-mentsandnosubstituteforyourownanaly-sis or a professional financial planner’sadvice.Takeinvestmentdecisionscarefully,smartly,andwithpatience.

Thewriterisco-founder,Hermoneytalks.com

●YOURMONEYHEMANTHGORUR

Optforlongertenuretoearnhigherinterest rates

FINANCIALEXPRESS9 WWW.FINANCIALEXPRESS.COM

WEDNESDAY, JUNE 3, 2020

FD PPF

EPF

&

VPF

Bharat

Bond

ETF

Tax-free

bonds

`

❝❝

❝❝

ONBOND INVESTMENTSuyash Choudhary, head, Fixed Income, IDFCAMC

Bond investors have to choose their own best suitedrisk versus reward points on the yield curve.Thisseems to be 6 -7 year bonds on the sovereign curve.

●YOURQUERIES

Keepproofs ofmoratoriumrequest andacceptance●Ihaveapersonal loanfromClixCapital.I registeredformoratoriumonApril2,thedayIgotthemail fromthem.EMIduewasonApril7.However,it sentdebit instructiontomyaccountanditgotrejectedforinsufficientfunds.ThoughIhaveappliedformoratorium,IgotamessagesayingIhadbeenoptedoutforthesame.WhatshouldIdo?

—RBManoharIt is alwaysagoodhabit to save

emails/messageswhereyouarerequesting foranychange.In theabsenceofproof,itmaynotbepossible togetmoratoriumforApril2020.Howeverforavailing themoratoriumforMaytoAugust2020,dropanemail onhello@clix.capital.Youshouldgetan

auto-generatedemailsaying ithas receivedyouremail.In caseyoudonot,thentalk to itscustomercare toget theupdatedemail id.Savetheseemails asproofofyourrequestand itsacknowledgment.

●IhaveAxisBankcreditcardandamunabletoavailmoratoriumasthecustomercareservice isnotworkinginthebankingapp.Idon’thavemoneytopayminimumdues inthemonthof June.TillnowIhavepaidmyminimumdues.WhatshouldIdo?

—SunnyLook foranupdateonthe link

https://www.axisbank.com/avail-moratorium-on-bank-emi.Currently,the site says thebank isworking towardsextendingmoratoriumtill endofAugust2020.Thedetails and link foravailing themoratoriumwill beonthispageonce thebankhasworkedout itspolicy.

●I tookloanfromLoanTap.FromAprilI tookEMImoratorium.While itacceptedmyrequest,itwentaheadwiththeECSwhichcoudnotbehonouredandICICIBankhas leviedacharge.WhatshouldIdo?

—VijayKumarYourrequest formoratoriumshould

haveanemail trail as calls to call centerswillnothaveproof.Ifyoureceivedacommunication fromLoanTapafteryourrequest,keep that safely.Yournext stepwill be towrite to info@loantap.ingivingyourloandetails andthe fact (withproof)that theNBFChadalreadyregisteredyourrequest.Give thescreenshotof thecharges ICICIBankhas levieddue to theloanEMIECSnotgettinghonoured.Request it to reimburse thesechargesastheoversightwasontheirpart.

Thewriter is founder,AZUKEPersonalFinanceAdvisory (www.azukefinance.

com).Sendyourqueries tofepersonalfinance@expressindia.com

Chaitali Dutta

LOANSIf you are a long

term investor, do notsell your holdingsunless there is anemergency.You arebetter offwaitinguntil the Sensexrecovers to its

January 2020 levels,which itmay in 3-4

years’ time

Investing influctuatingmarkets: Buy,hold, or exit?

With banks slashing FDrates, investors have tolook for alternative debtproducts like post officeFDs,PPF,EPF/VPF andBharat Bond ETFs forhigher post-tax returns

ILLUSTRATION: SHYAMKUMAR PRASAD

HOLDBUY EXIT

?

ILLUSTRATION: SHYAMKUMAR PRASAD

Ahmedabad

●COVID DISRUPTION

FE BUREAUMumbai, June 2

A DAYAFTER the sovereign downgrade,Moody’sonTuesdaydowngradedissuerrat-ingsofeightbigcompaniesandfourbanks.They include Tata Consultancy Services(TCS),Infosys,OilandNaturalGasCorpora-tion(ONGC),StateBankofIndia(SBI),HDFCBank,EximBankandIndusIndBank.

The global rating agency cited eco-nomicdisruptioncausedbyCovid-19andsovereigndowngradeasthereasonfortheratings review.

While itaffirmedthe long-termratingof Mukesh Ambani-led Reliance Indus-tries,Moody’s revised the company’s out-look to‘negative’from‘stable’.

“The affirmation of RIL’s Baa2 issuerratingreflectsMoody’sviewthatitscredit

metrics remain appropriately positionedfor its rating,”Moody’s said.

The change in RIL’s outlook to ‘nega-tive’from‘stable’is in linewith the down-gradeoftheIndiansovereignratingwithanegative outlook.

According to Moody’s, RIL cannot berated more than one notch above theIndian sovereign.

The other companies downgraded byMoody’s are ONGC,Hindustan Petroleum(HPCL), Oil India (OIL), Indian Oil (IOC),BharatPetroleum(BPCL)andPetronetLNG.

Moody’s has kept ratings of Bank ofBaroda (BOB),Bank of India (BOI),CanaraBankandUnitedBankofIndia(UBI)underreview for downgrade. However, it hasaffirmed the rating of three public sector

lenders — Punjab National Bank (PNB),Central Bank of India (CBI) and IndianOverseas Bank (IOB).

“Moody’s has downgraded the long-termlocalandforeigncurrencydepositrat-ings of SBI and HDFC Bank to Baa3 fromBaa2,”theratingagencysaidinitsrelease.

Moody’ssaiditsuspectedthattheassetqualityandprofitabilityofSBIwillweaken.As a result,Moody’s placed SBI’s baselinecredit assessment (BCA) undera reviewforadowngrade.BCAisameasureoftheprob-ability that a bank will require support toavoid default. A downgrade of SBI’s BCAwould also result in the downgrade in theratingofSBI’sforeigncurrencysubordinatemedium-term note (MTN) programme.Similarly,Moody’s has downgraded HDFCBank’sBCAto‘baa3’from‘baa2’.

Moody’s assumes that SBI and HDFC

Bank will receive government support intimesofneed.However,Moody’swasoftheview that government support for privatesector banks would not be as forthcomingand timely as before.Moody’s lowered itsassumption of systemic support for HDFCBankto‘moderate’from‘high’.

Moody’s added that asset quality andprofitability of private banks would alsodeteriorate due to rising loan delinquen-cies and defaults amid the novel coron-avirus outbreak.The rating agencyfearedthat it could lead to rise in in credit costsforprivate banks.“Most rated private sec-torbankshavebetterlossabsorbingcapac-ity and stronger BCAs than their publicsector banks (PSB) peers,” Moody’s said.The rating agency assumes that privatebanks have stronger capitalisation andloan loss reserves in comparison to PSBs.

PRESSTRUSTOF INDIANewDelhi, June 2

THE RUPEE IS likely to be stable if crudeoil prices stay at moderate level and fiscaldeficit is under check,State Bank of IndiachairmanRajnishKumarsaidonTuesday.

So far, the rupee has been stableagainst the dollar, he said at the CIIAnnual session.

“If the crude oil (prices) remain wheretheyare,thentherewillbemuchlesspres-sure on it.Ourlargest importswere eithercrude oil or gold.So gold import is practi-cally zero and crude import is downbecause of softness in the prices.So that’swhypressureontherupeeismuchless...Sofar the restraints shown by the govern-mentandthetrendis likelytocontinueinthe future,”he said.

The rupee has not witnessed a sharpspikeinthepasttwomonthsandhasbeentrading in the range of 75-76 perdollar.

Brent crude, the global price bench-mark,was trading around $39 per barrelwhile oil forthe Indian basketwas quotednear$35 perbarrel onTuesday.

“I am expecting that currency is goingto be stable,”he said.

WithregardtolendingtotheNBFCsec-tor,KumarsaidSBIhasbeengivingfinan-cial support to all such institutionswhichhave satisfactoryrelationwith the bank.

BHAVIK NAIRMumbai, June 2

THE BONDMARKETon Tuesday ignoredMoody’s downgrade of India’s rating,withthe benchmark yield closing two basispointsdownat5.76%.

Bonddealerssaytheactionandthetim-ing were not completelya surprise and themarket still holds on to the belief that theReserveBankofIndia(RBI)willstepintobuybonds from the market to absorb the addi-tionalsupply.

Moody’s on Monday had downgradedthegovernmentofIndia’sforeign-currencyandlocal-currencylong-termissuerratingsto‘Baa3’from‘Baa2’.Theratingsagencyhadstatedthatthecountry’spolicymakinginsti-tutions will be challenged in enacting andimplementingpolicieswhicheffectivelymit-igate the risks of a sustained period of rela-tivelylowgrowth,significantfurtherdeteri-oration in the general government fiscalpositionandstressinthefinancialsector.

VijaySharma,seniorexecutivevice-pres-identatPNBGilts,saidthemarkethadbeenexpecting the downgrade for quite sometime. “India’s rating still falls under theinvestment grade category and going fur-ther,if it falls belowthat level,we maybe introuble.ThebondmarketisstillaliveonthehopesthatRBIwillbeoneofthemajorpar-

ticipants on the buying side to take care ofthe additional borrowing by the govern-ment and any upside in the yields. WithyieldsrefusingtohardenonTuesday,Idon’tthinkthecentralbankwillbeinanyurgencyto act sooneron the factorof rating action.However,anydelaybyRBIorlowkeypartic-ipation by RBI in buying the bonds has thepotential to severelyimpact the bond mar-ketsentiments,”Sharmasaid.

Overthe last fewweeks,market partici-pants have been anticipating the centralbank to announce measures to absorbtheadditionalsupplyofgovernmentbonds.However,RBI has not yet announced anysuchsteps.BetweenMay18andMay24,RBIdid not conduct any outright OMO pur-chases,accordingtotheWSSdocument.

“Ithasbeenawhilesincethemarkethasbeen expecting some measures from thecentral bank. However, with the yieldsremaining under control in recent times,RBI may not be under any sort of hurry toannounceanymeasures,”adealersaid.

` likely to remainstable if crudeprices stay atcurrent levels:SBI chairman

Sharekhan announces launch ofnewdiscount broking business

FE BUREAUMumbai, June 2

BANK OF INDIA (BOI) has said itsprofitability in the June and SeptemberquartersmaygetimpactedduetotheCovid-19outbreak.

“Profitabilitywillhopefullyimprovedur-ing the second half of the current financialyear,”thebankadded.

Thepublic-sectorbankhasprovidedtheinformation aftermarket regulatorSecuri-tiesandExchangeBoardof India (Sebi)hadasked companies to make detailed disclo-sures about the impact of the novel coron-aviruspandemicontheirbusinesses.

Bank of Baroda (BOB),another public-sector lender, had earlier disclosed thataround65%ofitscustomershaveoptedforaloanmoratorium.SanjivChadha,MDand

CEO of BoB,had also said the moratoriumfigures of otherpublic-sectorbanks shouldnotbeverydifferent.

Bank of India also said the lender hadsufficient liquidity to honour its debt andotherfinancialarrangements.“Thedemandfor banking products may improve duringsecond half of the current financial year,subject to restoration of normal economic

activity,”itsaid.“The impact of Covid-19 is different in

differentterritories,basedonitsseverancesand categoryof zone such as red,orange orgreen,”BoIsaid.Thebankadmittedthattheoutbreak of the Covid-19 pandemic hadimpacted credit and recovery segments.“Though there was an impact on recovery,loandefaultriskhasbeenlargelyminimisedon account of grant of moratorium by theReserveBankofIndia(RBI),”itsaid.

RBIhadgrantedmoratoriumtoborrow-ers for three months from March 1,whichwas further extended tillAugust 31 by theregulator.Although many lenders are pro-viding moratorium to non-banking finan-cial companies (NBFCs) on a case-to-casebasis, Bank of India was among the fewbanks which granted moratorium relief toNBFCswithoutdiscrimination.

Profitability in Q1, Q2 to get impacted by Covid: BoI

ICICI Bank commits`4 cr towardsWestBengal cyclone reliefICICI BANK on Tuesday announcedit has committed `4 crore to aid theWest Bengal government in itsefforts to provide relief andassistance in the areas affected bycyclone Amphan. Of this, the bankhas contributed `3 crore to the WestBengal State Disaster ManagementAuthority. Further, the bank hascommitted to distribute essentialfood supplies like rice, pulses, oilamong others, worth `1 crore, in thedistricts impacted by the cyclone inthe state, it said in a release. RajivaSinha, chief secretary of the state,accepted the cheque from seniorofficials of ICICI Bank.

MaxLifepaysdeathclaimsof`563crinFY20MAXLIFE Insurance has paid `563crore in death claims during the fiscalended March 2020,which coveredmore than 15,000 lives,the companysaid onTuesday.The companyhaspaid 15,342 death claims amountingto `563 crore in FY19-20,thusachieving an all-time high individualdeath claims paid ratio of 99.22% inits last five-yearperformance,it said.Since inception,Max Life has paidindividual death claims of `3,238crore to familymembers of its1,12,946 policyholders.

Agri-commodities:Tradinghoursrevisedto9am-9pmBSEHASrevisedtradinghoursforinternationallyreferenceableagricul-turalcommoditiestill9pm.Therevi-sedtiminghascomeintoeffectfromTuesday,theexchangesaidinacircular.Theboursehadreducedtheagriculturecommoditytradetimingto5pmafterthebreakoutofcoronaviruspandemic.Now,ithassaidtradinginagri-commo-ditiestobeginat9andcloseat9pm.

Quick

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MarketsFINANCIALEXPRESS10 WWW.FINANCIALEXPRESS.COM

WEDNESDAY, JUNE 3, 2020

SHRITAMABOSEMumbai, June 2

OUTSTANDING RETAIL LOANS in thebanking system fell 2.5% between Marchand April to `24.9 lakh crore for the firsttimesinceMay2018,showeddatareleasedbytheReserveBankofIndia(RBI).

Retailcredit,oneoftheprimeenginesforthebankingsystem’sgrowthinthelastfewyears,shrunkinAprilasthenationwidelock-down severely restricted avenues for con-sumer spending.Of late, lenders have alsoturnedmorecautiousontheretailsegment.

Whileallcategoriesofloanstoindividu-als recorded a decline between March andApril,the steepest fall in outstandings wasseeninloansagainstfixeddeposits(-14.6%)andagainstsharesandbonds(-9.67%).Out-standingconsumerdurableloansfell4.19%andotherpersonalloans,mostlyunsecured,fell3.69%month-on-month(m-o-m).

“In terms of annual incremental creditflowof~`6.2trilliontherewasashift frompersonalloansandagriculturetoindustriesandservicesMoMduetostrongcreditflowwitnessedinMarch.Fallinshareofpersonal

loansflowfromMar’20toApr’20(53.3%to43.2%)wasmainlyattributabletohousing(29.1% to 26.2%),” analysts at CentrumBrokingsaidinanoteonMonday.

Traditionally,bankshaveneverfacedanysignificant stress in their retail portfolios,barringtheagrisegment,whichsometimesthrewuphighslippages inadversecircum-stances. In the last few months,however,bankshavestartedtakingahardlookatthequality of their retail portfolios. KotakMahindra Bank has repeatedlyvoiced con-cernsontheunsecuredretailsegment.AxisBankhasalsotoldanalystsithasbeentight-eningthescrewsforits retail customers.Itsexecutive director (retail banking),PralayMondal,said the bankwill move more andmoretowardssecuredbusinessthisyear.

Whathasbeenanareaofstrengthforpri-vatebanksmayturnintoadifficultsituationfor them, analysts say.“Private banks aremore retail-focused.This supports incomediversity,but their risk appetite for unse-curedretail isalsosignificantlyhigherthanstate-owned peers. Moreover, they haveaggressivelyexpandedtheirretailexposureinrecentyears,”Fitchsaidinarecentreport.

SBI cuts savings rates by5 bps,ICICI Bank by 25 bpsFE BUREAUMumbai, June 2

STATE BANK OF India (SBI) and ICICIBankcutinterestratesonsavingsdepositsby five basis points (bps) and 25 bps,respectively, at a time when the repo ratehas undergone massive cuts and liquidityremains in surplus.

All savings accounts withSBI will now earn 2.7% perannum.At ICICI Bank, a sav-ingsaccountwithabalanceofless than `50 lakh will nowyield 3% per annum, whilethose with a balance of `50lakh ormorewill earn 3.5%.

This is SBI’s second cut tothe savings rate in as many months. Lastweek, the country’s largest bank hadslashedterm-depositratestolevelsnotseeninthelast17years.

The rate cuts by banks follow a steepdrop in the repo rate over the last twomonths.Intwoback-to-backmonetarypol-icyreviews,themonetarypolicycommittee(MPC)hasloweredthereporateby115bpsbetweenMarch27andMay22.Asaportionofbanks’loanbooksarenowlinkeddirectlytotherepo,theyhavebeenquicktopassontheratecutstodepositorsaswell.

SBI’s is currently the lowest savingsrate being offered in the banking system,

followed by that of ICICI Bank. SavingsdepositswithHDFCBankandBankofBar-oda (BoB)yield a little more at 3.25%.

Lenders have also gained confidenceabout paying depositors less as the latterseemunlikelytopulltheirmoneyinthecur-rent environment.Data from the ReserveBank of India (RBI) showed that depositswith the banking system grew 10.65%

year-on-year(y-o-y)duringthefortnight ended May 8,whilenon-food credit grew muchslowerat6.48%y-o-y.

Analysts expect depositrates to continue to fall acrossthe banking system, withlenders having a strong liabil-ity base better-positioned to

cut rates and preserve margins.In a recentreport, Motilal Oswal Financial Servicessaid, “The continued monetary easingwould drive further reduction in lendingyieldsundertheexternalbenchmarkandadecline in the one-yearMCLRrates (20-50bps reduction since January 2020) whilebanks have also been sharply cutting theretailandbulkdepositratesoverthelastfewmonths(largebankshavereducedTDratesbyupto150bps)tooffsetmarginpressure.Overall,we believe that large banks withstrong/granularliabilityfranchisewouldbeable to tackle the margin pressurev/s theirmid-sizedpeers.”

Money Matters

Jun 02May 19

5.760

5.775

The benchmark yieldfell due to buyingsupport

0.017%

G-SEC

Jun 02May 19

75.64

Inverted scale

75.35

The rupee endedhigher trackingAsian peers

0.247%

`/$

Jun 02May 19

1.0923

1.1170

The euro rose againstthe dollar

0.305%

C=/$

❝ ❝

STABLE RUPEERajnish Kumar, chairman, State Bank of India

Our largest importswere either crude oil or gold.So, gold import is practically zero and crude importis down because of softness in the prices. So, that’swhy pressure on the rupee ismuch less... I amexpecting that the currency is going to be stable.

SBI currently offersthe lowest savingsrate in the bankingsystem, followedby ICICI Bank

ANALYSTCORNER

Maintain ‘buy’on Voltaswith revised TP of `625

JEFFERIES

VOLTAS’ Q4FY20profitswere 10%belowexpectations as the engineering(MEP) segment saw 18% y-o-y revenuedecline. Unitary Cooling segment,primarilyAC, offset MEPweaknesswitha 20% y-o-y revenue growth &marginimprovement.We reduce FY21E EPSsharply to account for incremental3-6weeks of lockdown, butmarginallyby 5% in FY22E.Webelieve a strongbalance sheet and themanagementdelivering in a difficult environmentwill see premiumvaluations sustain.Maintain ‘buy’.Voltas hasmaintained itsmarket

leadership in air-conditioners (AC)withamarket shareof24% in FY20.Marginsimprovedby424bps y-o-y to 14.6%,drivenbyoperating leverage, productmix andpricing.Themanagementwasclear onnot compromisingonmarginsbygivinghugediscounts.A60-daysystem inventorydespite no sales inApril 2020 is a functionofnoproductionduring the lockdown.Utilisation ramp-upwill begradual and the focus is oncapturing asmuch sales aspossible inMay-June2020.Heatwave in the northhas helpedandalsodemand in tier-IIandTier-III citieswheredealerships

openedupearliervsTier-I. OurQ1FY21Esegment sales factors 70%y-o-ydeclinevs 50%earlier.Themanagementhighlighted there is

an intentionally highpropensity todelaypayments in thecurrentenvironment.Monetisation is the focusandexecutionwill be sloweddownwherepaymentsaredelayed.Globally, constructionwasconsideredanessential serviceanddidnot face the slowdownthatdomesticprojectsdiddue to the lockdown.However, thepaceofexecution isexpected to slow,given the sharp fall inoil prices andalsodelays inevents. InIndia, governmentprojectsmay seedelayedpaymentsbut themanagementexpects themtocomethrough. Sharprise inorderbookby56.5%y-o-ydoesleave somebuffer oncancellations forFY20-FY22E revenueCAGRtobemet.Voltasdelivering fairlydecent results

especially in contextofpeers likeBlueStar (`516,buy) andseeingamarginimprovement inACdespitemutedMarch2020should seepremiumvalua-tions sustain.WebelieveVoltas is agoodrecoveryplayonbothconsumptionandinvestment themes in Indiawitha strongbalance sheet toback it.Maintain ‘buy’with a revisedTPof`625,which reflects30xPEFY22Ev/s28xearlier.

SBI createsseparate verticalto drive MSME,agri financeINAMAJOR restructuring exercise,StateBankofIndiahascreatedasep-arate Financial Inclusion and MicroMarket (FI&MM) vertical with afocus on rural and semi urban areasto improve customerexperience.

Under this newly launched verti-cal,thebankwillofferloansmainlyforagriculture aswell as allied activities,and micro and small enterprises,SBIsaidinastatementonTuesday.

About8,000branchesinruralandsemi-urbanareashavebeenidentifiedto provide specialised services to themicro segment, it said.The thrust isalso to improve service quality andavailability through the bank’s vastnetworkofover63,000customerser-vicepointsinrural,semiurban,urbanandmetroareas. —PTI

Action Banks Non-financials

Moody’s ratings review

Downgrade

Under review

SBI, HDFC Bank, Exim Bank,IndusInd Bank

BoB, BoI, Canara Bank,United Bank of India

TCS, Infosys, ONGC, HPCL, OIL,IOC, BPCL, Petronet LNG

Affirmed rating PNB, CBI, IOB RIL, Genpact, UPL

Moody’s downgrades 4banks,8 companies

10-yr bond yield (%)

5.79

5.76

5.74

5.75

5.76

5.77

5.78

5.79

5.80 Intra-day, June 2

Open Close

Previous close: 5.777

Bond yields decline by 2 bps despiteMoody’s downgrade of India’s ratings

FE BUREAUMumbai, June 2

SHAREKHAN, A SUBSIDIARY of BNPParibas,onTuesdayannouncedthelaunchof its newdiscount brokerage platform.

Thefull-servicebrokingfirm,however,did not divulge details about the name ofthenewsubsidiary.ItannouncedthatPro-ject Leapp will be the first phase towardslaunching the discount broking categorythrough a newsubsidiarycompany.

Thenewdiscountbrokerageis likelytobe launched in the September endingquarterofthefinancialyear2021afterthebroking firm finishes the process of betatesting.The beta company will allow 100alphatradersandinvestorstotesttheplat-forminthelivemarketmode.Onthebasis

of first in,firstwin the selected 100 alphatraders and investors will have to give `5lakhasmarginandwill receiveoneyearofbrokerage forfree as awelcome gift.

“The 100 alpha traders and investorscan test the new platform in live-market-mode including many innovations onWatchlist, Detail Quotes, Orders andReports and give their feedback to the‘foundingseniorleadershipteam’ofProjectLeapp,”thebrokeragesaidinitsstatement.

Jaideep Arora, chief executive officer,Sharekhan by BNP Paribas, said, “Ourapproach is to have separate companiesand brands for discount broking versusfullserviceaswebelievethatgivenIndia’slow penetration in equity markets thereisa lotofrelevanceforbothsubcategoriesto grow.”

24,90,791

25,53,652

25,32,051

24,97,250

24,33,282

24,04,701

23,89,684

23,55,785

23,03,930

22,75,540

22,53,843

22,41,441

22,22,816

22,20,732

21,63,298

21,37,063

20,99,699

20,66,176

20,38,603

23,89,684

20,19,963

19,92,422

19,44,478

19,33,598

19,18,078

19,21,142

0

5,00,000

10,00,000

15,00,000

20,00,000

25,00,000

30,00,000

As on April 24, 2020April 27, 2018

Personal loans outstanding

Retail credit shrinks m-o-mfor first time in two years

Ahmedabad

FE BUREAUMumbai, June 2

THEBENCHMARKNIFTY50 iswithin kissing distance fromthe 10,000 points mark. Thebenchmark has gained 950points in the last six tradingsessions, retracing 31%of itslossessinceMarch23.

Domestic indices rose onTuesday, given the optimismaround the exiting of the lock-downand the assurance givenby Prime Minister NarendraModi for structural reforms tostrengthen the economy, andendedthedayatathree-monthhigh. The benchmark Sensexwas up by 522.01 points or1.57%tocloseat33,825.53.

The 50-share index Niftygained152.95pointsor1.56%tocloseat9,979.1,shyingawayfromtheimportant10,000ma-rk.Financialswere largely res-ponsibleforthemarket’srisk-on

mood,driving theNiftyup themost which led to the bench-markclosingat itshighest levelsinceMarch11.Foreignportfo-lioinvestors(FPIs)boughtstocksworth$997.5milliononTues-day,provisionaldatashows.

Accordingtomarketexperts,thecurrentrallyinthemarketisnotdrivenbyfundamentalsbutbecause of the excess liquidityinthecapitalmarkets.Thecen-tral banks around the worldhave takenmeasures to ensureexcess supply ofmoney in themarket which is leading to ademandforstocks.

G Chokkalingam, chiefinvestmentofficer,EquinomicsResearch and Advisory, said,“The markets are going upbecauseofanincreaseinliquid-itywitharound$9trillionworthof stimulus given by centralbanks globally.With excess liq-uidityinthemarket,there isnofundamental reason for the

markets to rally but becausethere are investors who havefunds and are sitting on them,theyare turning into buyers inthemarket.”

He further explained that

theoptimismmaynot last longin the equitymarkets asCovid-19 caseswill increase once theeconomyopensupandthatthemarketmaydecline inamonthortwo. InhisaddresstotheCon-

federation of Indian Industry(CII), Prime Minister Modistated that the governmentwouldtakestructuralreformstochange the course of the coun-tryandbuildaself-reliantIndia.

The Indianmarkets shruggedofftheMoody’sdowngradethathadcomethedaybefore,globalratings agencyMoody’s down-graded the Government ofIndia’s foreign currency andlocal currency long term issuerratingsto‘Baa3’from‘Baa2’andretainedanegativeoutlook.

SiddharthaKhemka,head -retail research,Motilal OswalFinancial Services, said,“Investors ignored India's rat-ingscutbyMoody'soverslowergrowthandcontinued to cheergradualeasingof the lockdownandgoodmonsoonprediction.Reassurance by PM in CII’sannualsessionthatIndiawouldreturntogrowthboostedsenti-

ments further. Institutional-buying over past few sessionsalsosupportedthemarket.”

In the last six trading ses-sions, the FPIs have boughtstocksworthmorethan$1.9bil-lion.Themarketswitnessedvol-umesworth`11.79 lakh croreagainstthesixmonthaverageof`13.9 lakh crore.On the otherhand,the cashmarket sawvol-umesworth`60,555.38 croreagainst the six-month averageof`43,047.1crore.

Globally,theEuropeanmar-ketswerehavingapositivetrad-ing session in anticipation ofanotherroundoffiscalstimulusmeasures by central banksacrossthecontinent.

ThestockmarketsintheUK,France and Germany were upbetween 1.05% and 2.12%,respectively. Dow Jones Minifutureswereupby151pointsatthetimeofpress.Asianmarketsalsoendedtheirdayhigherwithbourses in Shanghai, Taiwan,SouthKoreaandHongKongupbetween 0.20% and 1.11%,respectively.ThebiggestgainersonNiftywereBajaj Finserv,ZeeEntertainment, Bajaj Finance,KotakMahindraBankaswellasTataMotorswhichwere up by9.51%,9.06%,8.15%,7.69%and7.37%,respectively.

Shares of Kotak MahindraBankwereupby7.69%tocloseat`1,344.45apiece.

MARKETS 11FINANCIALEXPRESS

WWW.FINANCIALEXPRESS.COM WEDNESDAY, JUNE 3, 2020

Mumbai

June 02, 2020

For Nippon Life India Asset Management Limited(Formerly known as Reliance Nippon Life Asset Management Limited)

(Asset Management Company for Nippon India Mutual Fund)Sd/-

Authorised Signatory

Make even idle money work! Invest in Mutual Funds

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

(Formerly Reliance Mutual Fund)

NOTICE NO. 18 Record Date

June 08, 2020DIVIDEND DECLARATIONNotice is hereby given that the Trustee of Nippon India Mutual Fund (“NIMF”) has approved declaration of dividendon the face value of Rs. 10/- per unit in the undernoted scheme of NIMF, with June 08, 2020 as the record date:

Nippon Life India Asset Management Limited(Formerly known as Reliance Nippon Life Asset Management Limited)

(CIN - L65910MH1995PLC220793)

Registered Oice: Reliance Centre, 7th Floor, South Wing, OfWestern Express Highway, Santacruz (East),

Mumbai - 400 055. • Tel No. +91 022 4303 1000 • Fax No. +91 022 4303 7662 • www.nipponindiamf.com

Name of the Scheme(s)Dividend

(` per unit)*NAV as on June 01,2020 (` per unit)

Nippon India Interval Fund - Quarterly Interval Fund -Series III – Dividend Option

0.0364 10.0490

Nippon India Interval Fund - Quarterly Interval Fund -Series III – Institutional Plan - Dividend Option

0.0352 10.0493

Nippon India Interval Fund - Quarterly Interval Fund -Series III – Direct Plan - Dividend Option

0.0405 10.0478

*Income distribution will be done/dividend will be paid, net of tax deducted at source, as applicable.

Pursuant to payment of dividend, the NAV of the Scheme will fall to the extent of payout,and statutory levy, if any. *The dividend payout will be to the extent of above mentioned dividend perunit or the diference of NAV from the last Speciied Transaction Date (Ex. NAV) to the Record Date mentionedabove, whichever is higher. However, the payout will be subject to the available distributable surplus in theScheme as on the Record date.

The speciied Transaction period for Nippon India Interval Fund - Quarterly Interval Fund - Series III is on 8thand 9th June 2020 (both business days). The following shall be applicable for application received during thespeciied transaction period.

For Subscriptions including Switch-ins under Dividend Option

In respect of valid applications for subscriptions received up to 1.00 p.m. on the aforesaid Record Date alongwith a local cheque or a demand draft payable at par at the place where the application is received, the Ex-Dividend NAV of the day onwhich application is received shall be applicable. The investors will not be eligiblefor dividend declared, if any, on the aforesaid Record Date.

In respect of valid applications for subscription received after 1.00 p.m. on the aforesaid Record Date and/orup to 1.00 p.m. on the second day of the Speciied Transaction Period the closing NAV of the said second dayshall be applicable; In respect of valid applications received after 1.00 p.m. on the second day of the SpeciiedTransaction Period the closingNAVof the nextworking day shall be applicable, provided such a day is/has beendeclared as a Speciied Transaction day for the fund. Otherwise, the application will be liable for rejection.

In respect of purchase of units in Income/DebtOriented schemewith amount equal to ormore than Rs 2 lakhs,the applicable NAV shall be subject to the provisions of SEBI Circular Cir/IMD/DF/19/2010 dated November 26,2010 and CIR/IMD/DF/21/2012 dated September 13, 2012 on uniform cut-of timings read with provisions foradvancing of cut of timings for temporary period for applicability of NAV. With regard to Unit holders whohave opted for Dividend Reinvestment facility, the dividend due will be reinvested by allotting Units for theIncome distribution/ Dividend amount at the prevailing Ex-Dividend NAV per Unit on the record date.

For Redemptions including Switch-out under Dividend Option

In respect of valid applications received up to 1.00 p.m. by theMutual Fund, on the aforesaid Record Date theEx-Dividend NAV of the date of receipt of application shall be applicable and the investors will be eligible forthe dividend declared on the aforesaid Record Date. In respect of valid applications received after 1.00 p.m.on the aforesaid Record Date and/or up to 1.00 p.m. on the second day of the Speciied Transaction Periodthe closing NAV of the said second day shall be applicable.

Forunits indematform:DividendwillbepaidtothoseUnitholders/BeneicialOwnerswhosenamesappear inthe statementof beneicial ownersmaintainedby theDepositories underdividendplan/optionof theSchemeas on record date.

All unit holders under the dividend plan/option of the abovementioned scheme, whose names appear on theregister of unit holders on the aforesaid record date, will be entitled to receive the dividend.

Rs.

Basic ( Rs.)

March

31, 2020

December

31, 2019

March

31, 2019

March

31, 2020

March

31, 2019

[Audited] [Unaudited] [Audited] [Audited] [Audited]

1 Total Revenue 48,917 33,510 42,464 177,753 88,170

2 Net Profit/ (Loss) for the period before exceptional items and tax 6,430 (84) 5,993 16,547 18,108

3 Net Profit/ (Loss) for the period after exceptional items but before tax 6,147 (546) 4,948 12,127 17,063

4 Net Profit for the period after tax and Non-Controlling Interest 6,910 424 6,231 14,172 16,914

5 Total Comprehensive Income 7,120 418 6,279 14,390 17,126

6 Fully paid-up equity share capital (Face value 10/-) 5,766 5,766 5,766 5,766 5,766

7 Reserves excluding Revaluation Reserve as per balance sheet of previous accounting year (i.e. Other Equity) - - - 340,300 332,862

8 Earnings per share (of 10/- each)

[EPS for three months ended period is not annualized]:

a 11.98 0.73 14.77 24.58 40.10

b 11.98 0.73 14.77 24.58 40.10

Place: Ahmedabad

Date: June 2, 2020

By Order of the Board,

For Zydus Wellness Limited,

Dr. Sharvil P. Patel

Chairman

Notes :

1. The above is an extract of the detailed format of the three months and the year ended March 31, 2020, financial results filed with the Stock Exchanges under Regulation 33 of the SEBI [Listing Obligations and Disclosure

Requirements] Regulations, 2015. The full format of the financial results is available on the Company’s website : www.zyduswellness.in, on the website of BSE [www.bseindia.com] and on the website of NSE

[www.nseindia.com].

Sr. No. Particulars

Zydus Wellness LimitedRegistered office : Zydus Corporate Park, Scheme No. 63, Survey No. 536 Khoraj (Gandhinagar), Nr. Vaishnodevi Circle, S. G. Highway, Ahmedabad 382 481.

Tel. No. .(+91-79) 48040000 Website : www.zyduswellness.in, CIN No : L15201GJ1994PLC023490

Extract of Consolidated Audited Results for the Period Three months and Year Ended March 31, 2020

Three months ended Year Ended

Rupees in Lakhs

Diluted (Rs.)

Rs.

PGIM India Asset Management Private Limited(Erstwhile DHFL Pramerica Asset Managers Private Limited)2nd Floor, Nirlon House, Dr. A.B. Road, Worli, Mumbai - 400 030.Tel.: +91 22 6159 3000. Fax: +91 22 6159 3100CIN: U74900MH2008FTC187029 Toll Free No.: 1800 266 7446Website: www.pgimindiamf.com

NOTICE CUM ADDENDUM (No. 09 of 2020-21)

NOTICE CUM ADDENDUM TO THE SCHEME INFORMATION DOCUMENTS (“SIDs”) AND KEY INFORMATION

MEMORANDUMS (“KIMs”) OF SCHEMES OF PGIM INDIA MUTUAL FUND (“THE MUTUAL FUND”)

SIP Pause Facility

Notice is hereby given that, further to our Notice Cum Addendum No. 05 of 2020-21 dated April 22, 2020 w.r.t. Introduction

of Systematic Investment Plan (‘SIP’) Pause Facility (‘Facility’), SIPs registered through Stock Exchange Platforms, Mutual

Fund Utility (‘MFU’), other online platforms will now be eligible to avail this Facility.

All other terms and conditions of the Facility shall remain unchanged.

This Notice-cum-Addendum forms an integral part of SID(s) and KIM(s) of the Schemes of theMutual Fund, as amended from

time to time. All the other terms and conditions of SIDs and KIMs of the Schemes of the Mutual Fund except as specifically

modified herein above remain unchanged.For PGIM India Asset Management Private Limited

(Investment Manager for PGIM India Mutual Fund)

Place : Mumbai Sd/-

Date : June 2, 2020 Authorized Signatory

MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS,READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.

LIC Mutual Fund Asset Management Limited(Investment Managers to LIC Mutual Fund)

CIN No: U67190MH1994PLC077858

Registered Office: Industrial Assurance Bldg. 4th Floor, Opp. Churchgate Station, Mumbai - 400 020

Tel. No.: 022-66016000, Toll Free No.: 1800 258 5678, Fax No.: 022-22835606

Email: service@licmf.com • Website: www.licmf.com

NOTICE-CUM-ADDENDUM No. 09 of 2020-2021

MODIFICATION IN STATEMENT OF ADDITIONAL INFORMATION (SAI) - CHANGES IN THE DETAILS OF

KEY PERSONNEL OF LIC MUTUAL FUND ASSET MANAGEMENT LIMITED

Notice is hereby given to all the investors/unit holders that Ms. Y. V. Padmavati, Chief Human Resource Officer

(CHRO) ceases to be associated with LIC Mutual Fund Asset Management Limited (AMC) w.e.f. 1st June 2020

due to her repatriation back to LIC of India from the deputation in AMC.

Accordingly, all reference to Ms.Y. V. Padmavati in the SAI stands deleted.

All other terms & conditions of SAI remains unchanged.

For LIC MUTUAL FUND ASSET MANAGEMENT LIMITED

Date : 02/06/2020 Sd/-

Place : Mumbai Authorized Signatory

(` in Lakhs, unless otherwise stated)

Audited Financial Results for the Quarter/Year Ended 31stMarch, 2020

Particulars

Standalone Consolidated

Quarter Ended Year Ended Quarter Ended Year Ended

31-03-20 31-12-19 31-03-19 31-03-20 31-03-19 31-03-20 31-12-19 31-03-19 31-03-20 31-03-19

Audited Unaudited Audited Audited Audited Unaudited Audited Audited

Total Income from operations (Net) 63,234 65,309 69,640 2,54,165 2,58,514 67,455 71,204 74,774 2,73,796 2,77,316

Net Proit for the period before Tax,Exceptional items

3,700 3,962 5,370 15,174 16,028 3,613 4,013 5,392 14,384 15,421

Add: Share in Net Proit/ (Loss) of JV / Associate - - - - - 571 190 537 2,515 2,509

Net Proit for the period before Tax afterExceptional items

3,700 3,962 5,370 14,186 16,028 4,184 4,203 5,862 15,911 17,863

Net Proit for the period after Tax 3,128 3,213 4,362 12,641 12,764 3,615 3,436 4,838 14,319 14,529

Total Comprehensive Income for the period(Comprising Proit for the period (after tax)and Other Comprehensive Income (after tax))

3,127 3,154 4,157 12,462 12,827 3,796 3,377 4,631 14,322 14,591

Paid up Equity Share Capital (Face Value ₹ 2) 1,537 1,537 1,533 1,537 1,533 1,537 1,537 1,533 1,537 1,533

Earning per share -EPS (not annualized)-In ₹

Earning Per Share 4.07 4.18 5.69 16.46 16.65 4.68 4.40 6.27 18.54 18.84

Diluted Earning Per Share 4.06 4.17 5.68 16.46 16.62 4.67 4.39 6.26 18.54 18.80

Notes :

1) The above is an extract of the detailed format of Quarterly Financial Results iled with the Stock Exchanges under Regulation 33 of the SEBI (Listing and

Other Disclosure Requirements) Regulations, 2015. The full format of the Quarterly/Year Ended Financial Results are available on the Stock Exchange

websites. (www.bseindia.com and www.nseindia.com) and on the Company`s website (www.tcil.com)

2. The inancial results were reveiwed by the audit committee and were thereafter approved by the Board of Directors of the Company at their respective

meetings held on 2nd June, 2020. The statutory auditors of the Company has carried out the Audit of the above inancial results.

For Transport Corporation of India Ltd.

Place: Gurugram Vineet Agarwal

Date: 2nd June, 2020 Managing Director

Transport Corporation of India Ltd.CIN: L70109TG1995PLC019116

Regd. Oice : Flat Nos. 306 & 307, 1-8-271 to 273, Ashoka Bhoopal Chambers,

S.P. Road, Secunderabad - 500 003 (TG)

Corp. Oice : TCI House, 69 Institutional Area, Sector-32, Gurugram -122 001, Haryana

Tel: +91 124 2381603-07, Fax: +91 124 2381611, E-mail : secretarial@tcil.com,Website: www.tcil.com

NUPURACHARYAMumbai, June 2

INFLOWS INTO THE bondmutual fundsmore thandou-bledlastmonthfromAprilafterregulators took steps to restoresentiment soured byFranklinTempleton’s shock decision towindup$4.1billionof its localcreditfunds.

Fixed-income funds took inanet`94,220 crore ($12.5bil-lion) in May, compared with`43,430croreinApril,theAsso-ciationofMutualFundsinIndia(Amfi)saidinatweet.Creditriskfunds,a categoryof debt prod-uct, suffered net outflows of`19,200crore inApril.TheRBIonApril 27 offered asmuch as`50,000croretobanksforlend-ing tomutual funds to containthe fallout from the Franklin’sfreeze. —BLOOMBERG

‘Flows into India’sdebt fundsmorethandouble inMay’

Niftygains 950points in 6 sessions, recovers 31%of losses sinceMarch 2333,825.53

Open Close

SensexIntra-day, June 2

33,100

33,250

33,400

33,550

33,700

33,850

34,000

Prev close: 33,303.52

33,450.19

INDIA'S GOLD IMPORTS inMayplunged99%fromayearearlierasinternationalairtravelwasbannedandjewelleryshopswereclosedamidanationwidelockdowntocurb the spreadofCovid-19,agovernmentsourcesaid on Tuesday. The world'ssecond-biggest consumer ofthe precious metal importedaround 1.4 tonnes of gold inMay,downfrom133.6tonnesayear ago, said the source,whodeclinedtobeidentifiedbecau-setheyarenotauthorisedtosp-eaktothemedia. —REUTERS

India's May goldimports fall 99%from a year ago

Nifty50

March 11, 2020 June 2

10,458.409,979.10

5,000

6,500

8,000

9,500

11,000

Kotak Mahindra BankIntra-day on NSE (`), June 2

Open Close1,250

1,275

1,300

1,325

1,350

1,375

1,3231,342.90

Prev close: 1,248.40

Ahmedabad

12 FINANCIALEXPRESS

WWW.FINANCIALEXPRESS.COMWEDNESDAY, JUNE 3, 2020

Ahmedabad

13FINANCIALEXPRESS

WWW.FINANCIALEXPRESS.COM WEDNESDAY, JUNE 3, 2020

Ahmedabad

BLOOMBERGJune 2

WHAT WAS MEANT to be alandmarkyearforJapan-Chinarelations has turned sour, asthe US standoff with Beijingleaves PrimeMinister ShinzoAbe caught up in a fight be-tween his country’s biggesttrading partner and its solemilitaryally.

If all had gone according toplan,PresidentXiJinpingwouldhave been feted on a statevisitto Japan lastmonth,the firstofitskindinadecade.Instead,theevent that Abe had told Xiwouldmarka“newera”inrela-tions was called off as bothcountries battled the infection—andits future is inquestion.

Abeisnowlookingtodeflectcollateral damage at home asthe world’s two biggesteconomiesbattleoverthepan-demicandHongKong.Theten-sions between Japan’s largesttrading partners come asAbetries to revive a Japanese econ-omythatanalystsexpecttosuf-feracontractionofalmost22%this quarter, the deepest forrecordsbackto1955.

A staunch supporter ofDonaldTrump,Abehas stoodby the US president in recentweeks. And that could poserisks for Japan’s exposurein China.

“IfAbe falls outwithChinacompletely, it will be detri-mental to him at home andabroad,” said Shi Yongming, aformer Chinese diplomat toJapanandnowaresearchasso-ciate at the China Institute ofInternational Studies.

But a flare up in a territor-ial dispute between the twoAsian powers and Beijing’smove lastweek to imposenewsecurity legislation that couldstifledissent inHongKonghas

helped stoke a resurgence ofJapan’s ownwariness towardChina. Some in Abe’s ownparty, as well as oppositiongroups, are questioningwhetherXi should visit Tokyoat all.

That could be a blow toAbe, who has poured timeinto mending a relationshipwith China that was at itsmost hostile in decadeswhenhe took office in 2012 — thepeak of a dispute over con-tested islands.While he suc-ceeded in restoring officialvisits, and opened Japan’sdoors to Chinese tourists,mistrust has simmered.

So far,the eco-nomic sideof the rela-tionship hascontinuedto be strongeven as po-litical issueshave waxedand waned.Japan’s for-eign directinvestmentin Chinarose by 37%from 2016to 2019, ac-

cording to ministry of fi-nancedata.Abe’s administra-tion has said economic tiesare good and China hassteered clear of taking onTokyo in the sameway it hasbattledTrump.

But there have been signsthat the relationship couldget worse. Last month, Japanearmarked $2.2 billion of aneconomic stimulus packageto help manufacturers whowant to reduce dependenceon China. This month it willimplement a law restrictingforeign investment in com-panies it says are core to na-tional security.

BACK PAGE14 FINANCIALEXPRESS

WWW.FINANCIALEXPRESS.COMWEDNESDAY, JUNE 3, 2020

02 June,2020

2. The above is an extract of the detailed format of the Standalone and Consolidated results for the quarter and year ended 31 March,2020 filed with the Stock Exchange under Regulations 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015.The full format of Standalone and Consolidated results of the company for the quarter and year ended on 31 March, 2020 areavailable to the investors on the website of the Stock Exchange (www.bseindia.com) and the Company's website (www.zimlab.in).3. The above results were reviewed and recommended by the Audit Committee and approved by the Board of Directors at theirrespective meetings held on 02 June, 2020. There are no qualifications in the audit report issued for the year ended 31 March 2020.

1. Total Income from Operations

2. Net Profit / (Loss) for the period (before tax and exceptional items)

3. Net Profit / (Loss) for the period before tax (after exceptional items)

4. Net Profit / (Loss) for the period (after tax and exceptional items)

5. Total Comprehensive Income for the period

6. Paid-up Equity Share Capital (Face value Rs.10 per share)

7. Other Equity (excluding Revaluation Reserve)

8. Earnings per share (not annualised)

a) Basic

b) Diluted

Income from OperationsProfit before TaxProfit after TaxTotal comprehensive income

31.03.2020 31.03.2020 31.03.2019

STATEMENT OF CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER AND YEAR ENDED 31 MARCH 2020

31.03.2020 31.03.2020 31.03.2019

Note: Key Standalone financial Information of the company is given below :

6919.57 27,773.92 9458.84

533.56

533.56

230.27

184.45

1.43

1.42

6.86

6.8

329.66

363.78

1,618.07

13,764.03

2.03

2.03

247.36

247.36

229.70

289.05

1.41

1.41

6,793.20

168.86

151.20

158.59

27,431.97

-148.74

174.06

147.10

9,362.66

765.52

462.23

429.42

ASSOCIATED PRESSBrussels, June 2

FROMSYDNEYTOParis,worldoutrageatGeorgeFloyd’sdeathintheUSwasgrowingonTues-dayastheEuropeanUnion’stopdiplomat said the bloc was“shocked and appalled” by itandthousandsmarchedinAus-tralia’s largestcity.

Chanting“Black LivesMat-ter”and“I can’tbreathe,”about3,000 protesters held an im-passioned but peacefulmarchthrough central Sydney onTuesday demanding funda-mentalchangeinracerelations.

In France, protests wereplannedfortheeveninginParisandacrossthecountryaftercallsfromthefamilyofaFrenchblackmanwho died shortly afterhewasarrestedbypolicein2016.Aprotestwasalsoplanned inTheHague,Netherlands.

Floyddiedlastweekafterhewaspinnedtothepavementbyawhite police officer inMin-neapoliswho put his knee onthe handcuffed black man’sneck until he stopped breath-ing.His death set off proteststhat spreadacrossAmerica.

EU foreign policy chiefJosepBorrell’sremarksinBrus-selswerethestrongestsofartocomeoutofthe27-nationbloc,saying Floyd’s deathwas a re-sultofanabuseofpower.

Borrell told reporters that“like the people of the US,weare shocked and appalled bythedeathofGeorgeFloyd.”

He underlined that Euro-peans “support the right topeaceful protest, and alsowecondemnviolence and racismof any kind, and for sure, wecall for a de-escalation of ten-sions.” Protesters around the

world have expressed solidar-ity with Americans demon-stratingagainst Floyd’s death.

In Sydney, a mostly Aus-tralian crowd,but also includ-ingprotesters fromtheUSandelsewhere, marched foraround a half-mile under po-lice escort in the authorised,two-hourlongdemonstration.

Many said they had beeninspired by amixture of sym-pathy for African Americansamidongoingviolentprotestsin the US, but had turned outto also call for change inAus-tralia's treatmentof its indige-

nous population,particularlythat involvingpolice.

“I can't breathe” notablywere the finalwords of DavidDungay,a26-year-oldAborig-inalmanwhodied inaSydneyprison in2015whilebeing re-strainedbyfive guards.

A total of 432 indigenousAustralians have died in po-lice detention since a 1991Royal Commission — Aus-tralia’shighest level of officialinquiry — into Aboriginaldeaths in custody, accordingto a running analysis by TheGuardiannewspaper.

WorldoutragegrowsatFloyd’sdeath;EU‘shocked,appalled’Thousands spilledacross streets inAmsterdam todenounce policebrutality

● PUBLICANGER Biden tries to break through asTrump takesmilitary footingBLOOMBERGWashington, June 2

PRESIDENTDONALDTRUMPsurrounded himself with ar-moredpolice andhis top aidesto make a symbolic walk to ariot-scarredchurchashesoughtto capture the spotlightwith adramaticthreattosendthemil-itary into American cities tosuppressspreadingunrest.

HisDemocraticchallenger,Joe Biden, worked to regaincenterstage throughthe floodofnews,schedulingamorningspeech at Philadelphia CityHall,where he planned to cas-tigate Trump for fanning“theflames of hate,” trying to takethe role of reassuring a nationon edge from days of protestsaround the country.

The split-screen imageshighlight the challenges thatBidenfaces incapturingatten-tion in a nation coping withcoast-to-coastprotestsagainstpolice brutality at the sametime it’s fighting the coron-avirus.Where Biden is invok-ingmessages of empathy andunity, Trump told US gover-nors to “dominate” the pro-testers orbe seenas“weak.”

The situation has putBiden in thepositionof react-ing to themovesof an incum-bent president given to dra-matic gestures, when theformervice president has lit-tle more than words to offerin return. Biden’s best hopemay be that voters viewTrump’s actions as a disturb-ing overreach — and indeed,the president has facedwith-ering criticism from Democ-

rats forusingmilitary force toclearhis pathofpeaceful pro-testers for the walk to StJohn’s Episcopal Church.

Inhisspeech,Bidenwillde-cry Trump’s leadership, ac-cordingtoexcerptsreleasedbythe campaign.

Describing the scene inLafayette Park on Monday,Bidensays,“Wecanbeforgivenforbelievingthatthepresidentis more interested in powerthan in principle.More inter-estedinservingthepassionsofhis base than the needs of thepeople in his care. For that’swhat the presidency is: a dutyof care — to all of us, not justourvoters,not justourdonors,but all ofus.”

The forced dispersal ofdemonstrators outside theWhiteHouse“dishonors everyvalue that faith teaches us,”said the top twoDemocrats inCongress, House SpeakerNancy Pelosi and Senate Mi-

norityLeaderChuckSchumer.The head of the Episcopal

Diocese ofWashington,whichoversees the historic church,expressedoutrage.

The visit was an “abuse ofsacred symbols for people offaith in this country to justifylanguage, rhetoric and an ap-proach to this crisis that is an-tithetical to everything westand for,” said Bishop Mari-annEdgarBudde.

Biden tweeted onMondaynightthatTrumpwas“usingtheAmericanmilitaryagainst theAmerican people. He tear-gassedpeaceful protesters andfiredrubberbullets.Foraphoto.”

ButBidenwillneedtooffera proactive vision as well, touse themoment to invoke thesort of calls for racial healingthat were a hallmark of thepresident he served as vicepresident, Barack Obama —while struggling to matchObama’s rhetorical gifts.

REUTERSBern, June 2

WORLD SOCCER'S GOV-ERNING body FIFAhas askedcompetition organisers touse “common sense” withplayers who showmessagesof protest over the death ofGeorge Floyd, an unarmedblack man killed in policecustody in the United States.

The move,which marks achangefromapreviousstronglineagainstplayersdisplayingmessagesonthe field,cameasathletes and sports figuresaround theworld made theirviews on the situation in theUnited States clear.

FIFA regulations bar play-ers from displaying any“po-litical, religious or personalslogans, statements or im-ages” on their kit. Since2014, this ban has includedundershirts — a response toplayers lifting up their shirtsto display a message afterscoring a goal.

But several playersprotested during matches inGermany’s Bundesliga at theweekend,withBorussiaDort-mund’s Jadon Sancho andAchrafHakimidisplayingun-dershirts with the message,“Justice for George Floyd” onSunday.

The German Football As-sociation (DFB)has said itwasreviewing the incidents.

EnglandinternationalSan-chowasshownayellowcardaf-ter removing his shirt but theDFB said itwas not due to hismessage but because he brokethe rulesonremovingshirts.

FIFAasks leagues touse‘common sense’as sport protestsoverFloyd’s death

Joe Biden

Facebook takes grim role inworld’smost fragile nationBLOOMBERGDubai, June 2

THE CORONAVIRUS CAMErelatively late to Yemen, butevenwithadvancenotice ithasstill been ravaged by the dis-ease.

Withthewar-torncountrydi-videdbetweenthreecompetingauthorities, its economy andhealth systems shattered, andmalnutritionanddiseasealreadyrife,theoutbreak faced fewob-stacles.Yemen’smost strategi-cally important city,Aden,nowhas thehighestCovid-19mor-tality rate among confirmedcasesintheworldat70%,UnitedNationssecretarygeneralAnto-nioGuterressaidonMay28.

Evenduring theharrowinglast fiveyearsofconflict,Yeme-nis flooded Facebook throughthe holy month of Ramadanwithgreetingsandphotographsof fastsbeingbroken.Thisyear,though,theirpostswere oftenmessagesofcondolence.

“It has turned froma Face-book to a Deathbook inYemen,”SamiGhaleb,politicalanalystandfounderofal-Nidanewspaper, said of the out-pouring on socialmedia.“Thesorrows of Yemenis are a seawithout shores.”

While figures released byofficials put fatalities at a fewhundred since Yemen’s firstvirus casewas reportedmid-April,onlinecommentsaswellas accounts frommedics and

thosepreparinggravessuggestthe actual number is farhigher, and rising rapidly. In aworse-casescenario,theWorldHealth Organization sees atleast65,000deaths,andabouthalfamillionhospitalisations.

An outbreak on that scalewould add to theunravelingofacountrylocatedonamaritimepassage throughwhich nearlyfour million barrels of oil areshippeddailytoEurope,theUSand Asia, and enhance thechaos that al-Qaeda and Is-lamic State have been exploit-ingtoreestablishapresence.

Besides,“ifwe do not com-bat the virus everywhere,there’sahighlikelihoodthat itwill continue to circle theplanet,” said Jens Laerke,spokesman for the UNOfficefor the Coordination of Hu-manitarianAffairs.Richer na-tions must make an invest-ment inhumanity,he said.

That’swhy onTuesday theUN co-hosted a virtual donorconference, looking for $2.4billion to fund programmesthat assist 80%ofYemen’s 28millionpeople.

The event’s other sponsoris, controversially, Saudi Ara-bia.Since2015,theSaudimil-itary has led anArab coalitionseeking to restore the govern-ment ousted by Iran-alignedHouthirebels.Thefightinghaskilled 100,000 people, withanother 131,000 dying fromhunger, disease and lack ofmedical care, a UN-commis-sioned report found lastyear.

Asked by email about thekingdom’sparticipationgivenits role in thewar, Laerke saidSaudi Arabia has provided“largeamountsofmoneywithno strings attached” thathelped beat back a loomingfamineinYemenandcontrolacholera epidemic.

80% industrial units inGujaratresumeoperationsFE BUREAUAhmedabad, June 2

NEARLY 80% INDUSTRIALunits across Gujarat have re-sumedoperationsfollowingthestategovernment’spermissionto function with 100%work-forceoutsidecontainmentareasaspartofunlockdown-1,accord-ingtoGujarat’s industriescom-missionerRahulGupta.

“Wehaveremovedodd-evensystemfortextileandothermar-kets.Industriesacrossthesectorsarenowgraduallyreturning tonormalcy.Demands forpowerandnatural gashave alsogoneupwhichindicatesincreaseinin-dustrialactivities,”saidGupta.

Asperanofficial in thestateenergy department, the peakpowerdemand in the state hascrossed 340million units.Lastyear’speakdemandwasaround390millionunitsinMayendandbeginningofJune.Withmorein-dustrialunitsopeningup,currentyear’s demandwould catch upwith lastyear’s figure innext10to15days,said theofficial.Thevolumesfornaturalgasplayers-Gujarat State Petronet andPetronetLNG-haverecoveredtoalmost90%ofthelevelstheyhadinpre-Covid-19lockdowntimeonthebackofdemandfromtheindustry,saidtheofficial.

On labour related issue,Gupta said that unskilled andsemi-skilledworkers arebeingsourced locallyandas farasmi-gration of skilled workforce isconcerned,thereare still someproblems. With industries re-

sumingwork,reports related tomigrant labourers returning insome industrial sectorsarealsocomingin,headded.

Morbi ceramic industry iswitnessingreverse trendasmi-grant labourers are rejoiningwork.AttheAsia’slargestceramicclusterwherenearly1,000unitsaresituated,over60%unitshaveresumed operations, thoughwithlimitedcapacity,saysNileshJetparia,presidentofMorbiCe-ramicAssociation,adding thatwithunlockdownprocessbegin-ning,theceramicindustryinGu-jarat is expectingfreshdemandincomingdays.

Textilemarketsoutsidecon-tainment zones inAhmedabadandSurathaveresumedopera-tions without any restrictionsfromMondayonwards,saysDe-vkishanMangani,chairman,tex-tile committee chairman, Gu-jaratchamberofcommerce.

TextileprocessingunitsinGu-jaratwouldtakesometorestartdue to dearth of demand andlabour shortage, says NitinThakker,presidentofAhmedabadTextile Processor’s association,adding,that despite this nearly30%unitscouldreinitiateopera-tionstoclearpendingorders.

“Engineering,casting,forg-ing and auto part makers aregraduallyreopeningtheirunits.Thoughthegovernmenthasal-ready given them permission,butmostof theseunits situatedin Rajkot, Bhavnagar, Suren-dranagar,Jamnagar,AhmedabadandVadodaraarefunctioningatbelow50%capacity.

‘Newera’ forChina-Japan tiesdissipates overTrump-Xi fight

Japanese PrimeMinister ShinzoAbe

China codifies sexual harassment by lawHUIZHONGWUBeijing, June 2

TWO YEARS AGO, Zhou Xi-aoxuanpubliclyaccusedoneofChina’s most recognisablepeople of groping and forciblykissing her, setting off afirestorminacountrythatdidnotspecifysexualharassmentas a legal offence.

LastweekZhouanddozensof other women who startedChina’s #MeToo movementwon a small victorywhen thenation's parliament enactedlegislation that for the firsttime defines actions that canconstitute sexualharassment.

Thereferenceinthenewcivilcode,approvedonThursdaybyasessionof theNationalPeople’sCongress, is largelya symbolicstep.Whileitholdsschools,busi-nesses andotherorganisationsresponsible forpreventinganddealingwithsexualharassment,itdoesnotlayoutguidelinesforenforcement.

“The civil code is abig step,butmuchmorewillneed tobefleshed out,” said Darius Lon-garino, a senior fellow at thePaul Tsai China Center at YaleLaw School.“After all,US sex-

ual-harassment law is still de-veloping after decades andgrapplingwith its failures, aslaidbareby#MeToo.”

Still, some lawyers and ac-tivistssaythecivilcodeoffersforthefirsttimeanationallyrecog-nisedenumerationofsexualha-rassmentasalegaloffence.

Article 1,010 of the newcode says apersonmaybeheldliable“forspeech,words,imagesorbodilyactionsthathavebeenusedtocarryoutsexualharass-mentagainstaperson’swishes.”

The development couldpave the way for furtherchanges to allow sexual-ha-rassment victims to seek re-dress,six lawyers andactivistsinterviewedbyReuters said.

The parliament’s Legisla-tive Affairs Commission andChina’s State Council did notrespond to faxed requests forcomment about the decisiontodefinesexualharassment inthe civil code.

China’s#MeToomovementtookoff in2018whenacollege

student in Beijing publicly ac-cused her professor of sexualharassment.ItspreadtoNGOs,mediaandother industries.

Zhou’s accusation againstZhu Jun,awell-knownTVper-sonality,was one of themostprominent.Inaseriesof socialmedia posts, she described a2014 incident when she wasan intern working for him atstatebroadcasterCCTV.

She says he tried to reachinto her dress and drag herontohimself,andthenforciblykissed her. Zhou’s accusationquicklywentviral.

Zhu denies the allegationsand is countering Zhou. Hecould not be reached, and hislawyerdeclinedtocommentonthecaseorthenewlegislation.

Some activists and lawyersare hopeful that the move-ment is starting to lead to realchange,startingwiththemen-tion in the civil code.

“MeToo’s spread hasmadea huge push on thismatter oflaw,”saidZhou,whosaysmuchmore needs to be done to pro-tect the rights of sexual-vio-lencevictims.“But thismaybeaprocess,andyoucan't solve itinone leap.”

More thanayearandahalflater,therehavebeennohear-ings in the case brought byZhouinSeptember2018.MostChinese#MeToocases remainunresolved,activists say.

Zhou filed hers under thecategory“personalityrights”—a broad term in Chinese lawthat includes rights applyingto one’s bodyandhealth—be-cause sexual harassmentwasnot recognisedasa legal causeof action.

“Ifyouwantedtogobringacourt case, then you had tobringa labourdispute—itwasvery difficult,” said a womanwhobroughtherown#MeTooaccusation against a promi-nent charity founder in 2018andwhoworksunderthenameHuahua forprivacyand safety.She ultimately chose not totakeheraccusation tocourt.

Sexual harassment re-mains sensitive in China.Themovement, despite bursts ofgrassroots activity, has facedgovernmentpressureandcen-sorship,the activists said.

TheStateCouncildidnotre-spond requests for commentabouttheallegationsofpressureandcensorship. —REUTERS

Ahmedabad