QBiz: Rs 3.1L Cr in Farm Loan Waivers; Bad Loan Recovery Begins

QBiz: Business news from across the country.

UP farmers are disheartened after a sandstorm ruined their prospects of bulk-exporting mangoes to Iran. (Photo: AP)

1. India Faces Rs 3.1 Lakh Cr Farm Loan Waivers, 16 Times 2017 Budget for Rural Roads

As demands for farm loan waivers grow across Punjab, Haryana, Tamil Nadu, Gujarat, Madhya Pradesh and Karnataka – after Uttar Pradesh and Maharashtra wrote off loans worth Rs 36,359 crore and Rs 30,000 crore respectively – India faces a cumulative loan waiver of Rs 3.1 lakh crore ($49.1 billion), or 2.6 percent of the country’s gross domestic product (GDP) in 2016-17.

A waiver of this scale could pay for the 2017 rural roads budget 16 times over or pay for 4,43,000 warehouses or increase India’s irrigation potential by 55 percent more than the achievements of the last 60 years.

(Source: Bloomberg Quint)

2. Banks Take Charge to Recover Bad Loans Worth Rs 1.5 Lakh Crore

State Bank of India has taken the lead in the banks' initiative, which follows the Reserve Bank of India's order to initiate insolvency and bankruptcy proceedings against the top 12 defaulters that account for a quarter of total bad loans in the banking system.

Banks are getting into loan recovery overdrive. At least six meetings of joint lenders' forums have been called next week to finalise the resolution of loans aggregating nearly Rs 1.5 lakh crore involving Essar SteelBSE 0.41 %, Bhushan SteelBSE 2.18 %, Alok IndustriesBSE 0.36 %, Monnet Ispat, Jyoti Structures and Electrosteel SteelsBSE – 1.40 %, said three people familiar with the development.

(Source: Economic Times)

3. BP, Reliance to Revive India Investments in Oil, Gas After Eight Years

BP Plc and Reliance Industries Ltd. will invest as much as $6 billion to restart work in Indian oil and gas blocks after eight years, in an area off the South Asian country’s east coast where both companies have faced trouble boosting production.

The companies aim to develop about 3 trillion cubic feet of resources that will result in production of an additional 30 million to 35 million cubic meters a day of gas from the D6 block in the Krishna Godavari basin between 2020 and 2022, Bob Dudley, chief executive officer of BP, said in New Delhi Thursday.

BP and Reliance, which are resuscitating their partnership after coming together in 2011, have been encouraged by several government reforms, including the freedom to price and market gas. Prime Minister Narendra Modi aims to increase the share of gas in India’s energy mix to 15 percent by 2020 from 6.5 percent. Oil Minister Dharmendra Pradhan said last year that the nation’s deep water gas fields will attract $20 billion of investments over the next five to seven years.

(Source: Bloomberg Quint)

4. Petrol Price Cut by Rs 1.12, Diesel by Rs 1.24 per Litre

Petrol price was on Thursday cut by Rs 1.12 per litre and diesel by Rs 1.24 per litre, the last of the fortnightly revisions after which daily correction in rates in step with cost will be implemented.

From Friday, petrol and diesel rates will be revised in sync with any movement in international oil rates. Rates will change at 6 am everyday depending on movement in cost on the previous day.

Currently, prices are revised on 1st and 16th of every month based on the fortnightly average of international oil price and the foreign exchange rate.

(Source: Business Standard)

5. 'We Convert 60% of Our Summer Interns into Regular Hires', Says Amazon India's HR Head

Summer internships give companies a long enough opportunity to assess a student, as compared to 15- to 30-minute interviews during campus placements. Additionally, it also helps a student to check out if the company is a good employer.

E-commerce firm Amazon India converts 60% of their summer interns into full-time employees through pre-placement offers, Raj Raghavan, head of human resources, Asia Pacific, at Amazon, told Mint in an exclusive interview. “We have a fairly good idea about what we want an intern to come and accomplish when the intern comes to us and that helps us assess them better,” he said. Edited excerpts:

(Source: Livemint)

6. GST: Companies Offer Big Discounts to Clear Stock

It is turning out to be bonanza time for consumers as companies, ranging from apparels to car manufacturers, woo them with attractive discounts ahead of implementation of the Goods and Services Tax (GST) next month.

While apparel manufacturers are trying to liquidate old stock ahead of the new tax regime, automobile companies are attempting to draw buyers to showrooms with attractive limited period discounts of up to Rs 2.5 lakh across a range of vehicles sold in the country.

Brands such as Levi's, Reebok and Woodland are currently on a clearance mode offering high discounts.

The retailers do not want to keep much of stock because the remaining stock will move to the GST regime and the margins would then vary. No brand can sell the entire stock before 1 July, but they are trying to do the maximum.

Harkirat Singh, Managing Director, Woodland Worldwide

(Source: Bloomberg Quint)

7. Revenue Target of $20 Bn by 2020 Seems to Be out of Reach: Ravi Venkatesan, Co-Chairman of Infosys Board

The board of directors at InfosysBSE -0.66 % will set revised growth targets in place of the much-touted goal of $20 billion by 2020 as India's second-largest software exporter aims to forge a consensus with its iconic promoters on the strategy for future growth in a turbulent market for global outsourcing.

The revenue target of $20 billion was set by chief executive officer Vishal Sikka in fiscal 2015 but slowing industry growth and the company's own challenges have made it a hard one to reach, along with the other goals of reaching profit margins of 30% and achieving $80,000 in revenue per employee.

(Source: Economic Times)

8. Telcos Ask Trai to Fix Floor Price for Voice Call, Data

The onslaught of free services and low tariffs by Reliance Jio has forced some of the old operators to ask the Telecom Regulatory Authority of India (Trai) to fix a floor or minimum price for voice call and data. The demand, however, impugns the principle of forbearance, which has been in place for the past 14 years.

During a meeting between top executives of telecom companies and Trai Chairman R S Sharma on Thursday, some of the telcos raised the issue of operators offering below-cost tariffs to consumers, and said it could hurt the financials of the industry.

(Source: Business Standard)

9. Monsoon, GST Next Triggers for BSE, NSE After Fed Rate Hike

Indian stock indices retreated to their lowest close in three weeks on Thursday, tracking subdued world equity markets, after the US Federal Reserve hiked interest rates for the third time in six months.

Analysts said the markets will seek near-term cues now from the implementation of the goods and services tax (GST) and the progress of monsoon rains. With stock valuations still at elevated levels, there are also concerns whether domestic fund flows alone will be enough to sustain the next leg of the rally.

On Wednesday, the US central bank raised the benchmark lending rate by 25 basis points and said it would begin cutting its huge holdings of bonds and other securities this year. One basis point is one hundredth of a percentage point.

(Source: Livemint)