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Nirmala Sitharaman Launches India Standards Portal
May 08,2017

n++India needs to make it possible to provide quality goods at an affordable price.n++ This was stated by Ms. Nirmala Sitharaman, Minister of State (IC) for Commerce and Industry.

The Minister also launched the India Standards Portal - a one stop centre for all information on Standards, Technical Regulations, conformity assessment & accreditation practices, and the related bodies in India.

The Minister observed that while standards are important, they also need to be affordable. Prime Minister Shri Narendra Modi launched the Zero Effect, Zero Defect campaign earlier for this purpose.

The Minister stated that any national strategy for standards should be able to provide information regarding how varieties can be accommodated as this was also necessary for international negotiations. A lot of grey areas are used to stop imports from various countries using sanitary and phytosanitary standards (SPS) and technical barriers to trade (TBT) requirements. Almost 150 such notifications are provided to the country every month. It is important to get this information to people in a time bound manner.

She highlighted the existence of variety in agriculture based products and how one size fits all homogeneity cannot be brought to this sector. The Minister stated that there was a problem of information dissemination as it is difficult to get information to farmers on time. While appreciative of the launch of the India Standards portal, she suggested that a feature be added for people to access this information via their phones and an SMS service must be provided for the same. n++I am impatient to get this information to those who must conform to these standards,n++ she said.

She mentioned two streams of challenges which needed to be addressed over the course of the conclave. One relates to how India can become part of the standards setting system and increase conformity, the other relates to Indias role in the global debate. Standards are not just about export promotion but also making India ready to meet its internal needs.

Mr. R V Deshpande, Minister for Large and Medium Industries and Infrastructure Development, Karnataka, said that the state is providing incentives to the industrial units adopting standards. Its procurement policy included standards conformity and it has established infrastructure for conformity assessment with focus on Research and Development.

Ms. Rita Teaotia, Secretary, Department of Commerce stated that since the last edition of the Conclave, the new Bureau of India Standards (BIS) Act has been passed and the Consumer Products Act has been amended as per the recommendations of the previous Standards Conclaves. She noted that for the first time, standards in the services sector are being addressed. She suggested a National Strategy for Standards as well as Vision Document for the same.

Ms. Alka Panda, Director General, Bureau of Indian Standards (BIS), suggested the creation of a Technical Regulation Management Board which would provide an institutional framework to ensure policy coherence and coordination on standards and technical regulations.

Mr. Adil Zainulbhai, Chairman, Quality Council of India, stated that there was a need to work with SMEs to help improve their standards. He also spoke of the need to create a standards compliance system which was easy to comply with.

Mr. Rakesh Bharti Mittal, President Designate, CII highlighted standards for the services sector e.g. tourism & hospitality, healthcare, education etc. He stressed on the need for greater involvement of states in the development of standards as well as the need to help MSMEs and the agriculture sector comply with international standards.

Mr. Chandrajit Banerjee, Director General, CII outlined the outcomes of the various editions of the Standards Conclave. These include enactment of the BIS Act, recognition of the need for standards in services, development of a National Standards Strategy and the development of the National Standards Portal.

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Fitch: Global Demand for New Autos to Increase 1%-2% in 2017
May 08,2017

Global demand for new vehicles will increase 1%-2% in 2017, according to Fitch Ratings. Growth in China, Europe and Brazil will more than offset demand declines in the U.S., Japan and South Korea. In the US, we expect sales to decrease to 17.0 million in 2017 from 17.5 million in 2016.

In China, sales growth will likely fall to the mid-single-digit range in 2017. The government has partially rolled back the tax incentive on small-engine vehicles that it enacted in 2015, raising the vehicle purchase tax to 7.5% from 5%. The tax increase will be phased-in to cushion the impact on vehicle sales, but Chinese consumers pulled forward their purchase of qualifying vehicles in late 2016 in anticipation of the tax increase, leading to lower sales of these vehicles in 2017.

European sales remain about 10% off their 2007 peak. We expect growth of 2% to 3% in 2017 in Europe due to pent-up demand, continued favorable economic conditions in several countries and low interest rates supporting vehicle purchasing.

US trade policy is also a key focus of investors. Among the Detroit auto manufacturers, a broad-based increase in import taxes on vehicles from Mexico would likely have a more significant impact on General Motors Company (GM) and Fiat Chrysler Automobiles N.V. (FCA) than on Ford Motor Company. Auto suppliers are less likely to be directly affected by import taxes, but a decline in demand for vehicles manufactured in Mexico would negatively affect the suppliers that manufacture components for them.

The Trump administration is also looking at relaxing some of the emissions and fuel efficiency regulations that were enacted under the Obama administration. However, due to continued tightening of emissions regulations outside the US, global auto manufacturers will likely continue investing in lower emission technologies. Also, auto manufacturers will likely try to avoid getting caught off-guard if fuel prices unexpectedly rise.

The migration toward electrified powertrains and the quickening pace of research into autonomous vehicles are also driving radical changes in the global auto industry. Although the effect of these changes will not be a near-term threat to traditional auto manufacturers and suppliers, the potential long-term effects could be substantial. Auto manufacturers and suppliers are competing with numerous start-ups and technology companies to dictate the terms of the coming disruption in personal mobility. Traditional auto manufacturers risk losing relevance as the mobility landscape changes.

As the global auto industry evolves, Fitch is placing increased emphasis on auto issuers long-term positioning relative to developing trends. A rapid change in the competitive environment could alter our view regarding issuers market positions, which could affect their ratings, although the shifting landscape is unlikely to have a direct effect on issuers ratings in the near term.

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Fitch: Basel III Implementation in APAC to Follow Global Pace
May 08,2017

Implementation of the second wave of Basel III rules might continue to be delayed in the Asia-Pacific (APAC) by a lack of progress in other markets, as regulators in this region have remained reluctant to take a lead in implementing requirements ahead of their global peers, Fitch Ratings says.

However, the credit profiles of APAC banks are unlikely to be significantly affected. We expect most APAC regulators will continue to push ahead with consultations, and most plan to be ready to meet scheduled deadlines, even if implementation is likely to be contingent on international progress. Moreover, APAC banks are still likely to prepare for the new requirements by further building up capital and other loss-absorbing buffers, which will strengthen their financial profiles and underpin ratings.

Implementation of some components of Basel III in APAC banking systems has already been delayed from the timeline set by the Basel Committee as a result of developments elsewhere. A new standardised approach for measuring counterparty credit risk exposures and revised capital requirements for equity investments in funds and for central counterparties - initially scheduled to be introduced by January 2017 - were delayed by US pushback and lengthy legislative processes in the EU. Those rules are likely to have a greater impact on European and US banks than banks in APAC. Only Singapore in APAC stuck to the agreed timeline, and it has applied transitional arrangements. Korea and India have rules scheduled to come into effect in January 2018, while those in Hong Kong, Australia and Indonesia are at the draft stage. Taiwans rules are final, but their implementation has been delayed to align with other jurisdictions.

There is a risk of delays to other Basel III regulations set to be introduced in the next few years, but we expect requirements on leverage ratios and net stable funding ratios (NSFR) to come into effect in January 2018, as planned. Most APAC banks are unlikely to have difficulty meeting leverage ratio requirements, as they do not generally hold huge stocks of low-risk-weighted assets.

Looking further ahead, we expect APAC regulators will continue to embrace the Basel Committees risk-weighted asset initiatives, including measures to limit capital relief from banks use of internal models, once these are finalised. Banks in APAC are less reliant on models than those in Europe, with regulators already sceptical of models being used to reduce risk-weighted assets, as evidenced by some of them having applied risk-weight floors to certain exposures. In addition, we expect that supervisory work across APAC will continue to result in frequent use of macro-prudential regulation to address the build-up of specific risk pockets or risks at a system-wide level.

A major reporting change is also scheduled for 2018, with the adoption in 10 jurisdictions of IFRS 9 - the new international standard that, among other things, introduces expected credit-loss provisioning requirements. We expect loan loss provision charges to be more volatile under IFRS 9, giving a better reflection of how risk evolves, while total loan loss allowances will tend to be higher. However, banks in some markets should be able to limit the provisioning impact by releasing reserves to offset initial additional charges.

Bank resolution remains a relatively low priority in the region. Frameworks are becoming stronger in jurisdictions where resolution regimes exist or are being developed, but progress has been slow and frameworks remain untested. Fitch expects sovereign support to remain available in most APAC jurisdictions, as regulators will be reluctant to require the bail-in of troubled banks senior debt holders in systems where financial markets are still developing or where banks are reliant on wholesale funding. A large deposit base that limits funds available for bail-in also weakens appetite for adding this option to resolution frameworks in a few countries.

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Ind-Ra: Daily Fuel Price Revisions to Boost OMCs Marketing Margins
May 08,2017

The governments recent decision to move to a daily fuel price revision for petrol and diesel is likely to result in improvement in the marketing margin per litre and thus the profitability of Oil Marketing Companies (OMCs), says India Ratings and Research (Ind-Ra). This move is another positive structural changes initiated by the government in the downstream sector. The other structural changes include the petrol deregulation in 2010, the diesel de-regulation in 2014, direct benefit transfer for LPG, give-it-up scheme for LPG, lowering the allocation of PDS kerosene, hike in prices of kerosene and the decline in crude prices had resulted in a decline in the gross under-recoveries. The diesel and petrol de-regulation had also resulted in an increase in the marketing margins for OMCs.

The increase in marketing margins per litre for the OMCs namely Indian Oil Corporation (IOC, IND AAA/Stable), Hindustan Petroleum Corporation (HPCL, IND AAA/Stable), and Bharat Petroleum Corporation (BPCL) will be driven by a) greater flexibility with OMCs to pass on the crude price volatility to the end-consumers at a higher frequency b) lower need for steep price hikes that was seen in the fortnightly pricing regime and thus lowering the possibility of political intervention and c) lower hoarding by the dealers in anticipation of price rises which resulted in probably a bigger share of inventory gains on the marketing segment at the dealer level rather than at the OMC level.

However, an increase in the marketing margins could also result in an increase in competition from private sector owned retail outlets and hence OMCs may balance the marketing margins to limit competition.

The OMCs will be free to change the prices of petrol and diesel on a daily basis, in-line with global best practices as against the current fortnightly price revision. In the current regime, the OMCs revise the rates on the 1 and the 16 of every month, based on the average price of crude and the exchange rate in the preceding 15 days. In the US, where the prices are revised on a daily basis the maximum upward price change was 60paisa/litre, while the maximum downward revision was 50paisa/litre with a median change of around 1paisa/litre in FY17. However, in India, the maximum upward price change during FY17 was INR3.38/litre, while the maximum downward revision was INR2.25/litre for petrol prices in Delhi.

Initially, the pilot for the daily price revision will be launched in Puducherry, Vizag in Andhra Pradesh, Udaipur in Rajasthan, Jamshedpur in Jharkhand and Chandigarh and gradually extended to other parts of the country.

Over the last three to four years, the downstream sector has seen a slew of structural changes which have helped the OMCs to reduce their short-term borrowings and consequently the interest burden substantially. In the last two years FY14-FY16, gross borrowing of PSU OMCs have fallen 29% and interest cost has consequently declined by 37%.

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Set up Stressed Assets Funds for NPA resolution- ASSOCHAM
May 08,2017

While lauding the resolute steps being taken by the government and the Reserve Bank of India to tackle the stressed assets in the banking system, the ASSOCHAM has suggested also creation of Stressed Assets Funds (SAFs) with active participation of the cash rich public sector firms to turn non-performing assets (NPAs) into the performing assets.

The chamber would be fully cooperating with the government and the Reserve Bank of India in finding immediate and sustainable resolution of the non-performing assets of the public sector banks, expecting a pragmatic and a practical approach by the lenders and the regulators in the face of the situations on the ground in different sectors of the economy, that remain under stress.

The ASSOCHAM suggested creation of some kind of a Stress Asset Fund (SAF) which can help in revival of the assets under high leverage. n++Once these assets are brought back to shape, the pay-backs to the SAF can take place. Different forms of the SAFs can be thought of, including some of which can be neutral to creating a hole in the government finances.

Some of the cash rich public sector companies can be encouraged to participate either in the SAFs or take over some of the assets where the present promoter wants to exit. With the green shoots in several of the sectors, this could even be an opportunity for the government or special purpose vehicles to buy assets at much lower valuationsn++, the chamber said.

Lauding the governments move to amend the Banking Regulation Act, along with enabling changes in other related laws, the chamber said while empowering the RBI to help the banks by way of oversight committees was a welcome move, more would be required.

n++The key would be to have persons of high integrity on these oversight committees, which then should be given all out support from the government to help the lenders resolve the top NPA accounts within a time bound period. What is equally important is that the persons mandated with the task can rest assured that they would be no fear of vigilance bodies after decisions involving some losses for the sake of reviving the stresses assets are taken in good faith,n++ said ASSOCHAM President Mr Sandeep Jajodia.

Once the resolution mechanism worked out by the individual banks or Joint Lenders Forum is approved by the RBIs Oversees Committees, the bank officials implementing the resolution should be given a free hand without any fear of future probes, so that viable commercial decisions are taken.

In cases where the stressed assets or NPAs can be turned back into healthy assets, the existing promoters should be extended adequate working capital for the purpose.

He said barring very few and exceptional cases, most of the NPAs in stressed sectors like steel, power, telecom or infrastructure, have resulted from adverse business cycles marked by crash in commodity prices , making investments worth several lakhs of crores of rupees unviable. n++This is a world wide phenomenonn++.

What is important is that in some of the sectors, policy measures like the ones seen in steel, are seen to be helping. A similar approach is required in power, roads, ports and airports. The issues between the concessionaires and the state authorities as also with the green tribunals should be resolved without any delay and the projects be brought back on viability route.

It impressed upon the RBI to quickly clear all the pending applications from foreign investors for setting up Asset Reconstruction Companies in India, giving them a clear-cut framework for business of asset reconstruction.

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DIPP & WIPO to set up Technology and Innovation Support Centers
May 08,2017

The Department of Industrial Policy and Promotion (DIPP) and World Intellectual Property Organization (WIPO) have signed an agreement to establish Technology and Innovation Support Centers (TISC).

WIPOs Technology and Innovation Support Centers (TISC) program provides innovators in developing countries with access to locally based, high quality technology information and related services, helping them to exploit their innovative potential and to create, protect, and manage their intellectual property (IP) rights.

Services offered by TISCs may include:

n++ Access to online patent and non-patent (scientific and technical) resources and IP-related publications;

n++ Assistance in searching and retrieving technology information;

n++ Training in database search;

n++ On-demand searches (novelty, state-of-the-art and infringement);

n++ Monitoring technology and competitors;

n++ Basic information on industrial property laws, management and strategy, and technology commercialization and marketing.

The Cell for IPR Promotion and Management (CIPAM) is designated as the National Focal point for the TISC national network. As the national focal point, CIPAM shall identify potential host institutions, assess their capacities and support them in joining the TISC project. CIPAM will also act as the main intermediary between WIPO and TISC host institutions and coordinate all the activities of the national TISC network.

Over 500TISCs operate worldwide and establishing TISC in India will give the host institutions access to the Global network. In upcoming years CIPAM is planning to establish TISCs in Universities, State Science Councils, R&D institutions etc. TISC will give an impetus to Knowledge sharing, sharing of best practices among the TISCs, capacity building, generation and commercialization of IPs

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NAFED procures more than 8.76 Lakh MTs of Pulses in 2016-17
May 08,2017

NAFED, a National Level Cooperative Marketing Federation of India, has set a record of procurement of Pulses and Oilseeds during the year 2016-17. NAFED has emerged as the leading agency of the Government of India for undertaking procurement of Pulses and Oilseeds in the country. During the financial year just ended, it has achieved procurement of more than 8.76 Lakh MTs of Pulses (Gram 0.20 Lakh MTs, Masoor 0.03 Lakh MTs, Moong 1.29 Lakh MTs, Urad 0.59 MTs and Toor 6.65 Lakh MTs) and more than 2.20 Lakh MTs of Groundnut, Copra and other oilseeds and benefitted the farming community at large by providing them remunerative price for their produce and helping the country in creating buffer stocks and stabilizing the prices of Pulses and Oilseeds.

NAFED has also started disposal of the buffer stocks. A substantial quantity would be supplied to Para-military forces and Defence Sector and also State Government as per their requirements under PDS and other such schemes.

NAFED has undertaken procurement of various commodities to the tune of Rs 5916.00 Crore approximately in this year and earned tentative profit of Rs. 106.00 Crore before interest which is the highest in the last decade and helped turn around financially. The Federation has strongly positioned itself as the n++Pulse Armn++ of the Government.

During the current year also, procurement of Rabi Oilseeds and Pulses such as Mustard seeds, Sunflower seed, Gram, Masoor etc. has started and NAFED has already procured 2.95 Lakh MTs upto 30th April, 2017.

The Financial Package for NAFED is also under active consideration of the Govt. of India and it is likely that a CCEA note would be placed in May, 2017 for approval of the Cabinet.

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Export of Oilmeals up by 19% in April 2017-SEA
May 08,2017

The overall export of oilmeals during April 2017, provisionally reported at 135,474 tons compared to 113,978 tons in April 2016 i.e Up by 19%, as per the data of oilmeals complied by Solvent Extractors Association (SEA) of India for the month of April 2017.

Indian Competitiveness of soybean meal in international market further reduced, resulting in to slowed down of shipment from India. This also affected the crushing. The recent increased in Indian soya oil imports is also exerting pressure on domestic soya oil prices, which together with soybean sales is squeezing crush margins.

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The Reserve Bank of India (RBI) has issued new guidelines to quicken stressed asset resolutions
May 08,2017

The Reserve Bank of India (RBI) has issued new guidelines to quicken stressed asset resolutions through the joint lender forums (JLFs) comprising creditors to borrowers who are in default.

The Framework for Revitalising Distressed Assets in the Economy - Guidelines on Joint Lenders Forum (JLF) and Corrective Action Plan (CAP)n++ aims at early identification of stressed assets and timely implementation of a corrective action plan (CAP) to preserve the economic value of stressed assets.

In order to ensure that the CAP is finalised and formulated in an expeditious manner, the Framework specifies various timelines within which lenders have to decide and implement the CAP. The Framework also contains disincentives, in the form of asset classification and accelerated provisioning where lenders fail to adhere to the provisions of the Framework. Despite this, delays have been observed in finalising and implementation of the CAP, leading to delays in resolution of stressed assets in the banking system.

The CAP can also include resolution by way of Flexible Structuring of Project Loans, Change in Ownership under Strategic Debt Restructuring, Scheme for Sustainable Structuring of Stressed Assets (S4A), etc.

Lenders must scrupulously adhere to the timelines prescribed in the Framework for finalising and implementing the CAP. To facilitate timely decision making, it has been decided that, henceforth, the decisions agreed upon by a minimum of 60 percent of creditors by value and 50 percent of creditors by number in the JLF would be considered as the basis for deciding the CAP, and will be binding on all lenders, subject to the exit (by substitution) option available in the Framework. Lenders shall ensure that their representatives in the JLF are equipped with appropriate mandates, and that decisions taken at the JLF are implemented by the lenders within the timelines.

The RBI further stated that:

(i) the stand of the participating banks while voting on the final proposal before the JLF shall be unambiguous and unconditional;

(ii) any bank which does not support the majority decision on the CAP may exit subject to substitution within the stipulated time line, failing which it shall abide the decision of the JLF;

(iii) the bank shall implement the JLF decision without any additional conditionalities; and

(iv) the Boards shall empower their executives to implement the JLF decision without requiring further approval from the Board.

Any non-adherence to these instructions and timelines specified under the Framework shall attract monetary penalties on the concerned banks under the provisions of the Banking Regulation Act 1949.

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CARE Ratings Debt Quality Index (CDQI) witnessed a significant improvement and increased above 90 in April 2017
May 08,2017

The CARE Ratings Debt Quality Index (CDQI) had exhibited stability, though with an upward bias, in the few months of FY17. The index, has, however, largely followed a declining trend during the second half of FY17. In April 2017, the index witnessed a significant improvement and increased above 90, influenced primarily by higher share of AAA issuers.

CARE Ratings Debt Quality Index (CDQI) denotes the quality of debt that can be interpreted over time and juxtaposed with other developments in the financial sector. The CDQI captures, on a scale of 100 (index value for the base year FY12), whether the quality of debt is improving or declining. Intuitively an upward movement indicates improvement in quality of debt benchmarked against the base year. As it is contemporary with minimum time lags, the health of the debt and credit markets is encapsulated on a near-real-time basis. The dataset comprises of 1,579 companies from the CAREs portfolio of 2,980 companies as of March 2012. The dataset is revisited at regular intervals and is replaced suitably with a new set of companies with a similar rating and an approximate volume of outstanding debt rated in case if an entity ceases to have a rating coverage. Currently, the volume of debt of the sample companies stands at Rs.30.65 lakh crore in April 2017.

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Need for centralized repository for cybercrime: ASSOCHAM-EY study
May 08,2017

A centralized database of cybercriminals should be maintained to keep a check and discourage cybercriminals from engaging in spurious activities in cyberspace, according to a recent ASSOCHAM-Mahindra EY joint study.

There is a need to establish a centralized repository for cybersecurity standards, best practices and guidelines, which can be used by law enforcement agency for preventing and investigating cybercrime, noted the conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) jointly with EY.

A dedicated national governing unit may be established in India, which will be the central agency for all state government cybercrime agencies to coordinate, integrate and share information related to cybercrime. Such a central agency will be responsible for driving all the cybercrime prevention initiatives, such as collaboration with private sectors, and training and awareness across the country.

The Government should provide well defined citizen awareness programs aimed at preventing cybercrime as a proactive mitigation. This has to be achieved through multiple media, such as print, radio and web to ensure faster and maximum reachability with local and national languages. Cybercrime awareness shall be introduced in academics in the early stages of education as a mandate for all the state and central, and public and private schools, adds the study.

Releasing the joint study, Mr. D S Rawat, Secretary General ASSOCHAM said, Mechanisms shall be established for independent monitoring of awareness program at regular intervals to evaluate the number of people/regions covered. Awareness material shall be updated regularly to cover up-to-date information.

In order to increase the rate of reporting cybercrime, it is important to have provisions for online reporting of the crime. Using this system, an online cybercrime complaint can be made by the victims of cybercrime. They will gain access to a convenient and easy-to-use reporting mechanism that alerts law enforcement authorities of suspected criminal or civil violations. Also, it will provide a central repository for reference to law enforcement and regulatory agencies at the national, state and local level.

A centralized database of cybercriminals should be maintained so that the criminals released from jails may be monitored. Such checks will discourage cybercriminals from engaging in spurious activities in cyberspace. Many countries, such as the USA and Australia have maintained a central repository of cybercriminals, noted the joint study.

It will be beneficial to have collaborations with International Cyber Security Protection Alliance, such as the Australian Cyber Security Centre (ACSC), National Crime Agencys National Cyber Crime Unit (NCCU) and the UKs CEOP. This will help in not only adopting the best practices by other countries for prevention of cybercrime, but also in increasing the capability, knowledge, training, skills, capacity and expertise of cyber security task forces. Additionally, it will help to reduce the harm caused to businesses, customers and citizens due to international cyberattacks.

India should be actively engaged as part of the international cybercrime associations centered on Asia/Europe and America to seek help and contribute for international cybercrime issues, said Mr. RAwat.

Skilled law enforcement personnel are the need of the hour, considering the highly technical and advanced nature of cybercrime being reported. To gear up to speed in containing and preventing cybercrime, there is a need to engage more cybercrime investigation professionals such personnel may be deployed at state level with access to dedicated laboratories for analysis at each state. Such teams also need to be part of the police team investigating cybercrimes. There should be a special recruitment for personnel to man cyber cells at every police station.

There is a need to increase the number of cybercrime cells and laboratories in the states and provide requisite manpower, training and infrastructure to them. Initiatives to setup the cybercrime cells and laboratories in states where these do not exist, and also upgrade and strengthen the existing cybercrime cells is required to cope up with the rapid cybercrimes.

In addition to the existing mechanisms, a strategy needs to be documented, which states the vision, objective and approach for cybercrime prevention in India. A definite cybercrime prevention program may originate as a specific recommendation of such a document.

The strategy and execution of cybersecurity needs to be developed with clear vision for addressing challenges related with cybercrime in the short term and mid-term with possible review mechanism to a long-term approach in this domain. The global practices from mature law enforcement organizations, such as the Federal Bureau of Investigation (FBI) and Interpol need to be leveraged and adopted as per their feasibility as part of the Indian cybercrime strategy.

Cybercrime, it is imperative that efforts and resources are dedicated to operationalize a nations cybersecurity strategy. If such initiatives are driven from the highest level of the government, it ensures that all stakeholders are interested and engaged in contributing to the success of any initiatives or programs. Such commitment, though it is an important enabler, is not sufficient to guarantee the success of any initiative or program. Monitoring and review mechanisms are essential to analyze and assess progress as well as consider measures for re-calibration and course correction as may be required.

It is important to define milestones and operationalize the strategy as per the desired impact of initiatives, which are being undertaken. A sample road map basis impact of initiatives is presented below. While several initiatives may commence in parallel, the graph presents a view of their impact on the overall ecosystem for combating cybercrime.

Spread awareness on cybercrime prevention since the cybercriminals are constantly inventing new ways to attack and are in search of potential victims. In fact, some of the most recent attacks on critical infrastructure of a few countries were perpetuated and successfully executed due to the low awareness level of most users, through phishing and social engineering methods.

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Rs 2.44 lakh crore NPAs sold to asset reconstruction firms: study
May 08,2017

As a crucial part of the resolution of the non-performing asset (NPAs), the Asset Reconstruction Companies (ARCs) have been sold Rs 2.44 lakh crore worth of gross NPAs even as the current stock of stress in the Indian banking system is estimated at Rs. 11.80 lakh crore, according to an ASSOCHAM-SIPI-Edelweiss study.

Seeking a level playing field with the banks in terms of conversion of loans into equity, the paper said that though a huge level of stressed assets, as much as 15 per cent of advances (9.84 per cent NPAs and 4.2 per cent restructured assets), is a matter of concern for the economy, it offers a huge opportunity for the ARCs, adds the joint study.

As many as seven ARCs have largely been promoted by banks even as foreign direct investment has also been permitted into the asset reconstruction, which the paper said should be treated as a resolution and not a recovery business.

The paper said there must be a level playing field along with more teeth to ARCs for dealing with the promoters of companies owing a high level of bank debt which has decayed into NPAs. At least 51 per cent conversion should be allowed to ARCs while reconstructing an asset.

The ARCs are not on par with banking system when it comes to equity conversion. While RBI has given sweeping powers to bank in form of Strategic Debt Restructuring (SDR) and even in case of normal debt conversion, ARCs are restricted to maximum 26 percent of equity share in a particular company.

The paper stressed that incentive structure has to be introduced for banks where 100 per cent debt is sold to ARCs. The banks are not following a consortium approach which is a major issue that leads to delay of 12-18 months for debt aggregation. ARCs have to resort to a time- consuming process of dealing with each bank separately, often at different commercial terms.

The companies under reconstruction require working capital and often the non-fund based requirements are high. The banks selling NPAs to ARCs, cannot lend, while non-bank entities, such as private equity /NBFC, demand very high interest along with priority in repayment over existing debt.

Further the banking system is completely against any new exposure including non-fund based to these companies, even if they have come out of their structural issues. n++This leaves the responsibility of providing working capital finance on the ARCs and even non-fund based limits have to be raised against 100 per cent cash margins thus putting more pressure on the resources of stressed asset and impacting the viability,n++ the ASSOCHAM- SIPI-Edelweiss said.

Besides, while there have been changes in the SARFAESI Act exempting applicability of stamp duty, states have yet to pass necessary legislations to give effect to the same. Further, the registration fee for such transaction documents is very high in many states, increasing the cost for the ARCs and finally the borrower.

The growth of ARCs in India has been primarily in four phases, the current one being the 4th phase and amongst the most exciting in terms of possibilities it presents to the industry. ARCs have been doing a lot of work to ensure that the banking system is relived from the structural NPA problem which they are currently facing.

Decline in NPA sales is on account of two main reasons; first because of price mismatch between the expectations of ARC and the banks two, due to resource constraints.

However, post March 2016, amendments and relaxation of shareholding limits in ARCs as well as increase in permitted FDI investment limit in ARCs has provided a fillip to sourcing capital. The number of ARCs having been granted certificate by RBI stands at 23 in March 2017.

Significant capital has been raised and is ready for deployment by existing players while several new high profile players are expected to commerce business in FY 2018.

n++While ARCs are an important means to help banks manage NPAs, at its heart, ARC business is a resolution business and not a recovery business. ARCs do not have any magic spell for revving a non performing asset. Process of resolving a stressed asset requires aggregation of debt outstanding to various banks, arrangement of capital, right sizing the business and bringing in a strategic partner. This requires a period of 3-5 yearsn++, said ASSOCHAM Secretary General Mr D S Rawat

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Nirmala Sitharaman has said that mid-term review of Foreign Trade Policy would be completed early to synchronise its roll out with GST
May 08,2017

Commerce and Industry Minister Smt. Nirmala Sitharaman has said that the revised Foreign Trade Policy (FTP) would be released early to synchronise the same with roll out of GST. The core focus of the revised FTP would be promoting exports from the SMEs and high employment potential sectors. Smt. Nirmala Sitharaman was chairing a meeting on the Mid-Term review of the Foreign Trade Policy 2015-20 organised jointly by Department of Commerce and Research and Information System for the Developing Countries (RIS) .

Major suggestions discussed during the deliberations related to promoting Rupee Trade, facilitating not only exports but also imports and reducing cost of credit. Participant recommended harnessing the high foreign exchange earnings and large employment generation potential of services related to the Tourism, Education and Health sector. Such services fall under the WTO category of the Mode 2 Services, also called the Consumption Abroad category. It was emphasised that promotion of mode2 in services sector shall contribute in domestic economic development and job creation.

Concerns were also raised on issues relating to GST and its impact on export. Minister said that Department of Commerce has already taken up these issues with Department of Revenue, and assured that it will again take up theses issues With DoR for placing it before GST council to find a solution.

Critical role of Logistics sector for export competitiveness was also discussed;, reducing the cost of credit in promoting exports, export basket diversification, strategy for promoting value added exports, agriculture exports and services exports were also deliberated.

It may be noted that while announcing the five year FTP, 2015-2020 on 01.04.2015, Honble Commerce & Industry Minister had announced that the policy would be reviewed on mid-term basis. The exercise has been initiated by Department of commerce in January 2017. DGFT has held consultation with a cross section of stakeholders.- Exporters, Traders, Export promotion Councils, Commodity Boards, Various Ministries of the Central Govt., State Governments, foreign missions of India and Industry Bodies- in this regard.

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Arun Jaitley asks the ADB to set up a regional hub in New Delhi for the South Asia region to meet growing aspirations of the people
May 08,2017

The Union Finance Minister Shri Arun Jaitley asked the Asian Development Bank (ADB) to set up a regional hub in New Delhi for the South Asia region in order to keep pace with the growing aspirations of the people and to expedite the process of project preparation and delivery for India and other countries in the region. He also urged the Bank to adopt country system for procurement, social and environmental safeguards expeditiously.

The Union Finance Minister Shri Arun Jaitley congratulated the Asian Development Bank (ADB) on completing its 50 years and serving the people of Asia-Pacific region. While lauding the efforts of the Bank in eliminating poverty in the region through development of physical and social infrastructure, Shri Jaitley called for a greater focus on renewable energy keeping in view our commitment to tackle climate change.

In urban development, especially in the sectors of drinking water and sanitation, Shri Jaitley underlined the major challenges faced by many developing countries in making the system work without having to depend much on the budgetary support from the national governments. He urged the Bank to promote sustainable models that will address these challenges. He called upon ADB to focus on climate resilient agriculture, better farm production technologies, improved value chain management and creation of better marketing infrastructure for farm produce.

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MoUs Worth Rs 2 Lakh Crores Signed in the India Integrated Transport & Logistics Summit
May 06,2017

Thirty-four MoUs amounting to about Rs 2 lakh crores were signed in the three day India Integrated Transport and Logistics Summit. These MoUs were in the areas of port connectivity, Integrated Check Posts (ICP) in the states of Bihar, Uttarakhand, Uttar Pradesh, West Bengal, Manipur, access to land port in Tripura, Assam and Mizoram, development of Logistics Parks in Telengana, Andhra Pradesh, Karnataka, Madhya Pradesh, Assam, Gujarat, Mizoram, development and furthering of multi modal logistics parks in Mumbai and Bengaluru and Haryana, exploring investment opportunities in logistics sector, dredging of inland waterways, implementation of 79 port connectivity projects under Sagarmala, development of port roads to Chennai and Vishakhapatnam ports, and connectivity to airport in Navi Mumbai, among others. Some of these MoUs are between Government agencies while others are between Government to Business and Business to Business.

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