Top headlines: RBI's one-time recast plan, monetising fiscal deficit

From the possibility of RBI's one-time recast plan to be limited, RBI likely to monetise fiscal deficit in second-half of FY21, a glance at GST's completion of 3 years tomorrow, here are the top news

RBI's one-time restructuring scheme may be limited to Covid-hit sectors

The Reserve Bank of India’s (RBI’s) one-time restructuring scheme may not be a blanket relaxation for all sectors of the economy, and the litmus test for qualification could be a clear-cut linkage with Covid-19-induced stress. Firms from the aviation, hospitality, and retail sectors are expected to be allowed to avail of the new scheme, whereas realty, steel, power, and telecom players could be excluded. “It may have to be established that the stress is due to the pandemic, otherwise it (the scheme) runs the risk of being misused,” said a source. Incidentally, while the one-time restructuring scheme was not on the agenda at the RBI’s central board meet on Friday, “two directors did make mention of it”, said sources. Read More...

It's not the lockdown but enabling of a false theory, says Rajiv Bajaj

Bajaj Auto’s plant in Waluj, Aurangabad, has seen an exponential rise in the number of Covid-19 cases with three of its employees succumbing to the disease. Rajiv Bajaj, managing director, Bajaj Auto, tells Shally Seth Mohile the numbers going up is inevitable, not only at Bajaj Auto but everywhere, with the unlock. Bajaj, who has been vocal about the perils of lockdown, says the states shouldn’t repeat the mistakes with more of it. Read More...

Govt may get RBI to monetise fiscal deficit in second half of FY21

After sidestepping the idea for the first half (H1) of 2020-21 (FY21), the Centre is now considering direct monetisation of its fiscal deficit by the Reserve Bank of India (RBI) in the second half (H2), Business Standard has learnt. “It is a high possibility,” said a top government official, when asked if the Centre was considering direct deficit monetisation. “In the latter half of the year, we will have a clearer picture of the economic damage the Covid-19 pandemic has unleashed, and may require further resources to provide support to the economy,” the official added. Read More...

FMCG firms start hiring in small towns as markets show signs of revival

Fast-moving consumer goods (FMCG) companies in India and their distribution partners have started hiring people in small towns and rural areas because these markets are showing signs of revival. Mandates have been handed out to staffing solutions companies such as Randstad India and TeamLease, officials at these firms have said, as players increasingly push into rural areas to capitalise on the uptick in the hinterlands. In contrast, auto companies and their dealers have not been that bullish with hiring, despite tractor sales increasing in May. Read More...

Bigbasket re-evaluates fundraising plan as demand and profit rise

Online grocery firm Bigbasket is having a relook at its earlier plan to go for a funding round in July because of the changed business environment. The company, which has started generating profits, is also seeing a huge spike in demand after the relaxation of the lockdown. The Bengaluru-based firm in January had appointed Morgan Stanley and Goldman Sachs to assist it in raising $150 million in a funding round towards June-July. Read More...

RITES to pick 24% stake in Railway's station redevelopment entity

The Centre’s Rs 1-trillion plan to redevelop 400 stations across the country is likely to get a boost with Railways subsidiary RITES in the final stage of taking up 24 per cent stake in the Indian Railway Stations Development Corporation (IRSDC). According to sources, a shareholder agreement was signed on May 21 and the proposal will be taken up for approval of the shareholders of both the companies in the annual general meeting expected in August. Read More...

Three years of GST: Still a long way to go for 'Good and Simple Tax'

As the goods and services tax (GST) completes its third year on June 30, a host of issues, such as assessee-friendly compliance system and increase in tax collections, remains unresolved. To its credit, the tax has not turned out to be broadly inflationary. In its fourth year, information technology infrastructure needs to be strengthened, compliance eased, multiple GST slabs and rates rationalised, and the compensation mechanism for states reworked. Read More...

Make Indian manufacturing competitive to curb Chinese imports: R C Bhargava

The answer to calls for boycotting Chinese imports lies in making Indian manufacturing much more competitive, deeper and widespread, but people should remember that shunning products from the neighbouring country may lead to them paying more for goods, Maruti Suzuki Chairman R C Bhargava said. While stating that importing continuously for long period "is not really in anybody's commercial interest", Bhargava also asserted that certain products continue to be imported as there is "little choice in the matter" due to their non-availability in India, or because of quality and pricing issues. Read More...

Govt may add more districts under rural jobs scheme for migrant workers

The government is not averse to including more districts under the recently launched rural jobs scheme for migrant workers after evaluating the need for an expansion, senior officials say, playing down the controversies sparked by the non-inclusion of districts in states such as West Bengal. They say the scheme may be evaluated after some weeks, following which a decision on including new districts will be taken, based on the demand from states. Read More...

Chinese companies' imports may stay stuck

Chinese companies in India could continue to face the heat as the government considers granting easier import approvals for non-Chinese companies in India, top officials said. "We are monitoring the situation and this could last a few more days," a senior government official told ET, even as India enters seventh day of imports from China being stranded at the ports owing to a nationwide alert. However, according to sources, the thinking in the government is that Chinese companies continue to be subjected to 100% manual checks even when the alert subsides. For instance, Taiwanese smartphone maker Foxconn, which runs two plants in India under different units, has not been able to get clearances for consignments to the factory that manufactures for China's Xiaomi. "There were discussions on whether to permit Authorised Economic Operators as the industry had made this proposal but it has now shifted to whether all imports, barring ones for Chinese companies, should be permitted," another person familiar with the discussions told Economic Times.

Make Indian manufacturing competitive to curb Chinese imports: R C Bhargava

The answer to calls for boycotting Chinese imports lies in making Indian manufacturing much more competitive, deeper and widespread, but people should remember that shunning products from the neighbouring country may lead to them paying more for goods, Maruti Suzuki Chairman R C Bhargava said. While stating that importing continuously for long period "is not really in anybody's commercial interest", Bhargava also asserted that certain products continue to be imported as there is "little choice in the matter" due to their non-availability in India, or because of quality and pricing issues. Read More...