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Saturday, January 11, 2020

economic news of india - world economic news - economics news for students - indian economy news

economic news of india - world economic news - economics news for students - indian economy news


How FM can help steel sector without any Budget relief for it

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For several hours daily, KG Murlidharan walks up and down the 4 km rail mill at the Bhilai Steel Plant. The mill that produced a 130 metre rail, the world's longest in a single piece, is now stepping up its production to cater to the Indian Railways' (IR) growing demand for steel."In April, we produced an average of 176 pieces per day. In December, the daily production rose to 226," said Murlidharan, the general manager helming the operation of the mill, a new addition to the plant that has supplied steel to many iconic ventures, including moon mission Chandrayaan 2 and the nation's first indigenous aircraft carrier, INS Vikrant.Ahead of the budget, scheduled to be presented on February 1, top managers of the plant want Finance Minister Nirmala Sitharaman to announce a road map of hefty spending on infrastructure, which in turn will invariably boost demand for steel.Talking to ET Magazine, Chief Executive Officer of Bhilai Steel Plant Anirban Dasgupta says the steel sector bottomed out sometime in October, and things are looking up now. He says the economic slowdown will only have a marginal impact on his company, a subsidiary of state-owned Steel Authority of India Limited, thanks to its near monopoly in the supply of rails for IR's tracks."Indian Railways is our biggest client. It consumes about 30-32% of our total production. Thanks to the doubling and tripling of lines, the Railways' appetite for steel continues to be robust. So, we are largely insulated from the economic downturn," says Dasgupta.If the budget cuts customs duty on import of coking coal, he says, it will substantially lower input cost. In Bhilai plant, about 90% of coal is imported, mainly from Australia, as India lacks good quality coking coal. Significantly, 70% of the plant's total cost on raw materials is incurred in buying coal.The turbulence in two sectors, automobile and real estate, has dragged down the steel sector in the previous three quarters. The auto sector consumes about 15% of India's steel produce, and in terms of sentiments, it acts as a barometer for steel. The only positive, though, is that steel prices rose during the last two months, albeit marginally.At this juncture, as Dasgupta explains, the entire steel industry is waiting for car sales to pick up — including those factories that have no exposure to the auto sector. "Auto sales have a pull factor. If the sector does well, steel prices will rise, and that benefits everyone," he adds.But the need for more spending on infrastructure cannot be downplayed. "We expect a continuation of investments in infrastructure sector. Also, a stimulus for consumption in rural sector will spur growth in steel," says PK Rath, chairman and managing director of Rashtriya Ispat Nigam, estimating that the sector may witness a healthy growth of 7% during the next fiscal year.Yes, the budget could at best provide succor to the sector. But in the longer term, a more holistic approach is required to make it stronger. After all, the per capita steel consumption in India is abysmally low at 65 kg, as against 400 kg in China. The National Steel Policy of 2017 envisages that by 2030-31, India needs to have 300 million tonnes of capacity, up from the current 140 million tonnes.

The future of dispute settlements is here

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With more than 75,000 tenants using home rental startup NestAway, disputes arising out of their refusal to pay rents or bills is not uncommon.Because of the small sums involved, the disputes are usually resolved out of court through arbitration, based on a clause present in the rental contracts. But with arbitration still a cumbersome and costly process mandating both parties to be present for hearings and involving the submission of many documents, NestAway began looking at how tech can be used to speed up resolution and also reduce the cost.Starting with trying to resolve disputes via email, it went on to incubate an online dispute resolution (ODR) platform — Cadre or Centre for Alternate Dispute Resolution Excellence. On Cadre, founded by Shalini Saxena and Kanchan Gupta, the resolution is done online through a website-based platform. 73206416 First, one party approaches the platform, which contacts the other party. If both parties agree to the arbitration rules, an arbiter is appointed and time-stamped intimations are sent on emails and WhatsApp and SMS. The parties do not meet face to face but communicate electronically, including via video calls. The decision, which is legally binding, typically comes in 20-25 days.At Cadre, the arbitrator's fee is levied on both parties, but is usually paid by the party that brought up the dispute. "Legal costs for resolving such disputes have halved. Also, a case that would take six months via arbitration is being settled in 30 days," says Rajneesh Jaswal, general counsel at NestAway.Though these are early days for ODR with about 30 cases resolved via Cadre so far, Jaswal is hopeful the numbers will rise. Cadre is not the only platform in India to foray into ODR. Sama, a startup by Pranjal Sinha, Akshetha Ashok and Vikram Kumar, is running a pilot for ICICI Bank. It is helping resolve nearly 10,000 disputes with values of up to Rs 20 lakh after winning an E-Alternate Dispute Resolution Challenge 2019 launched by the bank and Agami, a non-profit. Sama charges a commission for the services provided on its platform. 73206428 Last year, Vikas Mahendra, a partner with law firm Keystone Partners, cofounded the Centre for Online Dispute Resolution (CODR), which positions itself as an institution that will administer cases online end-to-end. It is currently focusing on arbitration training to build a talent pool and is looking to start resolving disputes by January end. 73206423 These are the early signs of the adoption of an alternative dispute resolution mechanism being widely used in China and the US, particularly in cases related to online transactions.In India, where courts are overburdened and the backlog of cases runs into lakhs, the argument for online dispute resolution is strong. "Access to justice in India is abysmal and resolving disputes is evidently a pain point, considering the time, money and effort involved," says Pranjal Sinha of Sama.While arbitration was intended as an alternative to going to court for certain kinds of disputes, that mechanism itself has become cumbersome and often expensive.ODR offers a more accessible, transparent and faster option, particularly for companies dealing with high volume and low value transactions done online. With more Indians transacting online — whether for e-commerce or banking — stakeholders say the timing is right for ODR to gain acceptance as an easy mechanism to resolve grievances. A year ago, a Nandan Nilekani -led panel on digital payments suggested that all payment system operators "must implement a fast and fair online dispute resolution system".Globally, ODR growth was fuelled by the e-commerce boom, with eBay and PayPal resolving millions of disputes online. "ODR can be used across sectors — from insurance to banking – and also for family disputes. It is about leveraging tech to prevent and resolve disputes," says Chittu Nagarajan, a pioneer in ODR who headed Community Court initiatives at eBay and PayPal.After the acquisition of her last ODR firm Modria by Tyler Technologies, Nagarajan in 2019 launched CREK ODR, an industry- and dispute-agnostic platform, which can be accessed by clients anywhere in the world. She underlines the need for a strong technology layer while implementing ODR. Her startup is an end-to-end SaaS platform with multiple features like virtual mediation rooms. "ODR is not just about applications. You need a fantastic tech platform. The design can't be the same for platforms resolving family and e-commerce disputes."Players are aware of the challenges in the adoption of ODR in India — from the lack of enough arbitrators to building trust among consumers. "People need to accept that disputes can be resolved without the parties seeing each other," says Jaswal. "The bigger test will be dealing with people who are not used to the digital ecosystem."Sama's Sinha says capacity building is also a concern. "Lawyers can now explore providing online arbitration and mediation services as a viable career option too."Nevertheless, there is growing conviction that it is only a matter of time before ODR is adopted at scale in India. CODR's Mahendra points to two recent judgements. In the first case, the Bombay High Court pulled up Tata Capital Financial Services when it was found to have used the same arbitrator for over 2,200 cases, paying him Rs 1,000 per case, which highlights the need for a large number of arbitrators at acceptable price points.In the second, the Supreme Court ruled that even in contracts with unilateral arbitrator appointment clauses, a person with an interest in a dispute must not be eligible to appoint an arbitrator. This ruling affects millions of contracts that have already been signed and forces organisations to look for independent appointing authorities for their contracts. "ODR and technological assistance are the only affordable solutions to this need for large-scale arbitration," says Mahendra.

Siachen: India wary of Pak-China nexus

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NEW DELHI: In a clear reference to China and Pakistan, Army Chief General Manoj Mukund Naravane said that the threat of collusion is the "maximum" in Siachen and Shaksgam valley, while adding that the army is "rebalancing" its deployments and resources on the western and northern fronts.Naravane, while addressing his first press conference after taking over as the Army Chief, said that Siachen is strategically very important to India. "That is one area where a formation is looking at both the western and the northern fronts. That is what makes it so strategically important. We must not lose sight that this is where the collusivity can happen. Therefore it is important to be on guard and keep that area in our possession," he said.Elaborating on the collusion between Pakistan and China, Naravane explained, "it can be both physical on land borders and in other spheres also. As far as the land border is concerned that is where the two countries are closest to each other. The threat of collusivity is maximum in Siachen and Shaksgam valley. Collusivity is also in other realms in technology and in coming to each other's help in times of trouble."The Siachen Glacier is a bone of contention between India and Pakistan. The Indian Army had gained control of it in 1984. Pakistan had made several assaults to capture it, but failed. Meanwhile, there have been reports claiming that China has constructed a road in the Shaksgam Valley, located north of Siachen, although the army has denied it in the past. On the army's strategy for the border with China, Naravane explained, "we have to balance out our requirements and deployments to cater for both west and north. For the northern frontiers, we are going for capacity building, which include building roads to forward areas, habitats, storage for ammunition and moving some of our advanced weapons system to eastern side. In a way of balancing out we can meet a threat from any direction. As a result of this rebalancing, we are now prepared for this challenge."The Army Chief said that the army's perspective plan and evaluation of threats and challenges over the years was focussed on the western front. "We now feel that both the western and northern fronts are equally important. In that context, that rebalancing is taking place," he said. In scenarios where there are simultaneous threats from both Pakistan and China, he explained that there will be a primary front and a secondary front. "The bulk of our forces and resources will be concentrated on the primary front. On the other front, we will adopt a more deterrent posture, so that we are not found wanting," he said.Dual-task formations that are ready to shift from the western to the eastern front and vice versa gain importance in this situation. "In this manner, we will be able to deal with both fronts to ensure territorial integrity is not compromised," he said.Naravane explained that the long term threat will always be conventional war and preparations in terms of improving training and new acquisitions are being made. "The short term requirement of getting involved in counter insurgency and counter-terrorist operations will remain for the possible future. But with the Rashtriya Rifles and Assam Rifles battalions who are facing the brunt of counter-insurgency and counter-terrorist operations, the regular army is training for its primary role which is the conventional war," he said."The various we are making, be it the towed gun system or ultra light howitzers and those in the electronic warfare domain is for conventional war. We have not lost sight of our primary aim, while remaining engaged in CI, CT operations," he added.

UK ambassador to Iran arrested: British government

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LONDON: Iranian authorities briefly detained Britain's ambassador in Tehran on Saturday, according to Foreign Secretary Dominic Raab, after he was reportedly arrested during protests against the regime. "The arrest of our ambassador in Tehran without grounds or explanation is a flagrant violation of international law," Raab said in a statement after the detention of Rob Macaire. The minister warned Iran that it was "at a cross-roads moment", and had to choose between "its march towards pariah status" or "take steps to de-escalate tensions and engage in a diplomatic path forwards." Macaire was arrested for allegedly "inciting" protesters in Tehran angry at the military's accidental downing of a Ukranian passenger jet, killing 176 people, most of them Iranian citizens, according to the Daily Mail. He was released after around an hour, it added. President Hassan Rouhani said a military probe into the tragedy had found "missiles fired due to human error" brought down the Boeing 737, calling it an "unforgivable mistake". The admission was an "important first step", Prime Minister Boris Johnson said earlier Saturday. "We will do everything we can to support the families of the four British victims and ensure they get the answers and closure they deserve," he said in a statement issued by his Downing Street office. Johnson added that Britain would work closely with Canada, Ukraine and other international partners to ensure "a comprehensive, transparent and independent international investigation and the repatriation of those who died." "This tragic accident only reinforces the importance of de-escalating tensions in the region," he said. "It is vital that all leaders now pursue a diplomatic way forward."

Tata Motors global sales dip 3% to 97,348 units in December

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NEW DELHI: Tata Motors on Saturday reported a 3 per cent decline in global sales, including that of Jaguar Land Rover, at 97,348 units in December.Global wholesale units of all Tata Motors' commercial vehicles and Tata Daewoo range last month stood at 34,526 units, down 15 per cent, from December 2018, the company said in a statement.The company's global sales of all passenger vehicles were at 62,822 units, up 5 per cent from December 2018, it added.Global sales of JLR stood at 50,001 units. Jaguar wholesale units for the month were 12,742 vehicles, while Land Rover wholesale stood at 37,259 units.

Amazon boss Bezos to face protests from traders during India trip

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NEW DELHI: Thousands of small-scale traders in India are planning to organise protests against Amazon.com Inc founder Jeff Bezos, who will visit the country next week for a company event and potential meetings with government officials.Bezos will participate in an Amazon event in capital New Delhi aimed at connecting with small and medium-sized enterprises, three sources told Reuters.He has also sought meetings with the prime minister and other government officials, with conversations expected to centre around e-commerce, one of the sources familiar with the matter said.Details of Bezos' visit, including his arrival date and the duration of his stay are not known.Amazon did not respond to a request to confirm the visit. The prime minister's office also did not respond to requests for comment.The Confederation of All India Traders (CAIT), a group representing roughly 70 million brick-and-mortar retailers, said it will protest across 300 cities during Bezos' stay in the country.CAIT has since 2015 waged a battle against online retailers Amazon and Walmart-controlled Flipkart, accusing them of deep discounts and flouting India's foreign investment rules.Both e-tailers have denied the allegations.Amazon has previously said its platform provides business opportunities to thousands of small sellers, artisans, weavers and women entrepreneurs. But CAIT is not convinced."We plan to organise peaceful rallies against Jeff Bezos in all major cities such as Delhi, Mumbai, Kolkata as well as smaller towns and cities," Praveen Khandelwal, the group's secretary general told Reuters."We expect to mobilise at least 100,000 traders in the protests."With its 1.3 billion population and the world's second-biggest smartphone user base that relies on cheap data for social media and online shopping, India is a key market for U.S. retailers Amazon and Walmart to grow their business.Discounts on their platforms have helped lure Indians to shop online for everything from groceries to large electronic devices, a phenomenon which traders say has unfairly hurt their business.New Delhi introduced rules last year to protect nearly 130 million people dependent on small-scale retail -- a key voter base -- by deterring large online discounts.The rules forced e-commerce firms to change their business structures, drawing criticism from the United States and straining the two countries' trade ties.The federal commerce ministry is reviewing complaints and evidence filed by CAIT against Flipkart and Amazon, Reuters reported previously. (Reporting by Sankalp Phartiyal and Aditya Kalra; Additional reporting by Jeffrey Dastin)

Huawei executive Meng Wanzhou can be extradited to US, says Canada's attorney general

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Canada's Department of Justice said a Huawei executive arrested in Vancouver could be extradited to the United States, because her offense is a crime in both countries, according to documents released Friday. Huawei chief financial officer Meng Wanzhou, who was originally detained on a US warrant in late 2018, faces an extradition hearing in Vancouver that begins on January 20. The United States accuses Meng of lying to banks about violating Iran sanctions. However Meng's lawyers maintain that she cannot be turned over to the United States, because in order for that to happen, her offense would have to meet a "double criminality" standard -- meaning it is a crime in both countries. Violating US sanctions against Iran, they say, is not a crime in Canada. However in the documents filed in Vancouver Friday, which were widely cited by media, Canada's attorney general said the "essence" of her banking interactions amounted to fraud, which is a crime in the country. The first week of Meng's extradition hearing will be devoted to the question of double criminality. Meng, who lives under house arrest at her mansion in Vancouver, denies the US allegations and says Canadian authorities violated her rights during the arrest. Her detention at the Vancouver airport in December 2018 caused an unprecedented diplomatic rift between Canada and China, which demands her release. Just nine days later China detained former Canadian diplomat Michael Kovrig and businessman Michael Spavor, whom it accuses of espionage.