The Government’s unrealistic policy of barring foreign direct investment in the business-to-consumer segment has pushed e-commerce retailers to camouflage themselves as market places to access funds from abroad The Delhi High Court is hearing a plea filed by the All-India Footwear Manufacturers and Retailers Association, regarding the alleged flouting of foreign direct investment rules by e-commerce companies. In its affidavit to the court, the Department of Industrial Policy and Promotion has argued that its job is to formulate policy — not monitor implementation. The DIPP added that it has already laid down a ‘transparent’ and ‘predictable’ policy which permits 100 per cent FDI in business-to-business transactions in e-commerce, but only prohibits in the business-to-customer segment. Further, it does not recognise...
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News & Media
DEBUNK ‘FAMILY SILVER’ ARGUMENT
In a clear case of judicial overreach, the Supreme Court has stopped the Government from selling its residual shares in Hindustan Zinc Limited even though it had no problems when majority of the shares were sold years ago In recent times, the judiciary has made deep inroads into policy making that lies strictly within the executive domain. The latest manifestation is an order by the Supreme Court to the Government of India, to stop selling the latter’s residual stake in Hindustan Zinc Limited. This order came in response to a public interest litigation filed by the National Confederation of Officers Associations of Central Public Sector Undertakings in 2014, which challenged the proposed sale of the Government’s 29.5 per cent stake...
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Dashing innovators’ hopes
Govt needs to shed its current intransigence. It should stop viewing patent laws from a prism that ‘only MNCs benefit from these’. Interacting with America’s top CEOs [including MNCs in pharmaceutical and agrochemical sectors] in September, 2015, Prime Minister Narendra Modi had assured “we are committed to protecting Intellectual Property Rights [IPRs] which is essential to fostering creativity”. These MNCs spend billions of dollars on research and development to discover and develop new medicines and crop protection products and have a fundamental interest in the protection of IPRs. They had flagged Section 3[d] of Patent [Amendment] Act 2005 and provision relating to grant of compulsory licenses as major concerns. However, from the draft of new National IPR policy, it appears...
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Too little too late
PM Modi needs to shed his soft-pedalled approach displayed in the “GiveItUp” campaign and bring the LPG subsidy to a full halt. The government has announced that from January 1, those earning more than Rs 10 lakh per annum will forgo subsidy on LPG on a self-declaration basis. This appears to be a grandiose announcement but in terms of reforms, it is a typical case of “too little too late”. At present, there are a total of 163 million registered LPG customers. Of these, 147 million people are availing subsidy. The remaining 16 million is accounted for by about 10 million–bogus/ fictitious persons–who were eliminated following the government’s drive to credit subsidy directly into the bank account of customers under...
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Doha agenda cast aside
WTO Nairobi Ministerial : The US has been asking India to supply all sorts of data which tantamount to virtual surveillance on our food security system In a brazen display of ‘might is right’ in the just concluded World Trade Organisation’s (WTO) 10th ministerial meeting at Nairobi, Kenya between December 15-19, the developed countries led by the US and the EU literally junked the Doha Development Agenda (DDA). On the two issues of critical importance to developing countries viz., (i) public stock holding for food security and (ii) special safeguards mechanism (SSM) in agriculture, they were merely handed out hollow assurances. At the 9th ministerial in Bali (December, 2013), developed countries had agreed to a ‘peace clause’ under which, if...
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It’s wrong to deny gas to the fertiliser sector
And worse still, to favour urea producers over decontrolled fertiliser units in gas allocation, exacerbating the nutrient imbalance The manner in which gas is allocated within the fertiliser sector smacks of arbitrariness. The Centre gives a uniform subsidy to all manufacturers, including those of decontrolled complex fertilisers, under the Nutrient Based Scheme (NBS) . Why, then, does it use a different yardstick for allocation of gas to manufacturers of urea on the one hand and decontrolled fertiliser on the other? A two-judge bench of the Delhi High Court has ordered the government to resume supply of natural gas to Deepak Fertiliser and Petrochemicals Corporation (DFPCL), a manufacturer of decontrolled phosphatic fertilisers, which was arbitrarily suspended last year. The bench has...
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India must protect its agricultural support
It needs to get ERPs updated and purchases from poor farmers excluded from product-specific subsidy maths. The World Trade Organization’s (WTO) draft declaration for the ongoing ministerial meeting at Nairobi, Kenya, on December 15-18, 2015, promises to “address all aspects of agriculture reform as a matter of priority”, but does not mention anything about finding a ‘permanent solution’ to India’s concerns on food security. While declaration is just cleverly-worded rhetoric, the fact that India’s concerns remain unresolved is a setback. But, for any one tracking the events since the 9th ministerial meeting, at Bali in December, 2013, this should not come as surprise. It is abundantly clear that, from day-1, developed countries were never serious about finding a permanent solution....
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US should shed rigid stand
In a just concluded meeting of the Trade Policy Forum, United States Trade Representative (USTR) Mic-hael Froman, emphatically rejected India’s request for signing a Social Security Agreement (SSA), nick named totalisation pact. The US argued that, “India did not meet the legislative requirement of minimum social security net (SSN) for 50 per cent of its population.” When Commerce Minister Nirmala Sitharaman drew his attention to the Atal Pension Yojna, Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana in addition to Employees Provident Fund Organisation, the US official’s reaction was that being “non-mandatory”, those schemes did not qualify for social security. The USTR opined that he is open to discussing new social security schemes that India may...
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The unabated food and fertiliser worries
With reforms in fertilisers and food stuck in a groove, it is but natural that the government is shirking from paying subsidy arrears Hamstrung by its inability to achieve target for divestment proceeds from public sector undertakings (PSUs) and lower-than-expected collection from direct tax revenues, the government has resorted to hard posturing with regard to release of subsidy payments under major heads—fertilisers and food. As far as fertilisers are concerned, against a budget allocation of R73,000 crore for the current year, the requirement is expected to be around R80,000 crore. Even as the ministry of finance is likely to provide for additional R7,000 crore, it is in no mood to release arrears of about R30,000 crore from previous year. The...
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SOME CARROTS BUT NO STICK
Modi’s new bailout package for State Electricity Boards is fine. However, he will need to force compliance In 2012, the UPA Government had granted a financial restructuring package of Rs2,00,000 crore, to deal with the debt of ailing State Electricity Boards. As part of the package, 50 per cent of the SEBs outstanding liabilities were taken over by the respective State Governments and the balance was issued to public sector banks at nine per cent interest. In return, the States were to increase tariff and reduce transmission and distribution losses to ensure that the realisation from sale of electricity equals the cost of procurement in two to three years. The objective was to eliminate losses and make SEBs stand up...
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