Oil cos say no fuel to AI at Hyd, Raipur airports from Sept 6

NEW DELHI: Oil marketing companies (OMC) have now threatened to stop fuel supply to Air India Group aircraft at Hyderabad and Raipur from the first week of September due to substantial dues from the Maharaja.

An Air India official said the airline will stop operations at Hyderabad — where it has 42 daily flight, including many international — and Raipur (12 daily domestic) if the oil supply is stopped from September 6 as warned.

Oil companies stop fuel supply to Air India in six airports, flights not yet hit

Oil marketing companies stopped Air India’s jet fuel uptake in six airports, including Kochi, Pune, Patna, Ranchi, Vizag and Mohali over payment defaults. On flights operated to these airports, Air India is currently uploading double the fuel quantity so as to have enough fuel to operate the return flight without refuelling at any of these stations.

Fuel supply to AI Group at six airports — Kochi, Mohali, Pune, Ranchi, Patna and Visakhapatnam — has been discontinued since August 22.

The airline is facing such a severe financial crisis that its officials say payment of salaries beyond that of October will not be possible unless fund infusion takes place.

Oil companies say AI has dues (with interest) of Rs 5,000 crore.

However, they may give fuel for AI’s Haj operations wherever required at the eight airports so that those flights are not hit.

An AI spokesman said: “AI jet fuel dues were Rs 4,600 crore as on March 31, 2019. That figure is down to Rs 4,300 crore as on July 31. We are paying Rs 18 crore daily for our fuel uplift.”

While the airline has been paying in full for daily uplift of fuel, it admits clearing dues is not possible without getting equity infusion from the government. AI has sought Rs 2,500 crore from the government immediately to meet working capital requirement and stay afloat. “If AI, which has a debt of Rs 58,000 crore to Rs 60,000 crore does not get this support, it cannot continue for too long,” said a person in the know. The airline has got no equity support this fiscal.

On its part, the government says it is committed to total privatisation of AI. But that process will take some months to reach its logical conclusion. “Keeping AI alive during that process is known is important.

An operational AI may get a buyer but a grounded one won’t for sure like Jet Airways (which stopped flying this April) so far. Without fund infusion the airline cannot keep flying. If the government has no plan to give monetary support to AI, then it is curtains for the Maharaja also now,” said a senior official.

PSBs merger: Bank employees stage protest

CHENNAI: Members of the All India Bank Employees‘ Association on Saturday staged a protest here against the Centre’s decision to merge 10 public sector banks into four entities.

Employees of public and private sector banks wore black badges to work as a mark of protest to the government’s decision.

The Association’s general secretary, C H Venkatachalam said the government’s move was “ill timed” and needs a review.

A rally opposing it was also planned by the Association, Venkatachalam told PTI.

He alleged the merger of public sector banks would mean closure of six banks.

The BJP government at the Centre had on Friday unveiled a mega plan to merge 10 public sector banks into four, to create fewer and stronger global-sized bankers as it looks to revive economic growth.

Finance minister Nirmala Sitharaman said 10 public sector banks — Punjab National Bank, Canara bank, Union Bank of India, Indian Bank, United Bank of India, Allahabad Bank, Syndicate Bank, Corporation Bank, Oriental Bank of Commerce and Andhra Bank would be merged.

“Government may call it a merger … six banks which have been built up over the years will disappear from banking scenario”, Venkatachalam said.

He recalled that when the financial recession was experienced world over in 2008, the domestic banking system was safe because of public sector banks.

On further course of action, he said the union would meet in New Delhi on September 11 to decide on going on strike.

Google reveals years-long ‘indiscriminate’ iPhone hack

WASHINGTON: Google security experts uncovered an “indiscriminate” hacking operation that targeted iPhones over a period of at least two years and used websites to implant malicious software to access photos, user locations and other data. In a post on the blog of Google’s Project Zero security taskforce, cyber experts did not name the hacked websites hosting the attacks, but estimated they received thousands of visitors a week.

“Simply visiting the hacked site was enough for the exploit server to attack your device, and if it was successful, install a monitoring implant,” said Project Zero’s Ian Beer.

Once installed, the malicious software “primarily focused on stealing files and uploading live location data,” Beer said, adding it had been able to access encrypted messenger apps like Telegram, WhatsApp and iMessage.

Google hangouts and Gmail had also been affected, he added in the post, which provided a detailed breakdown of how the malicious software targeted and exploited iPhone vulnerabilities.

Most of the vulnerabilities targeted were found in the iPhone’s default Safari web browser, Beer said, adding that the the team had discovered them in almost every operating system from iOS 10 through to the current iOS 12 version.

Once embedded in a user’s iPhone, the malicious software sent back stolen data, including live user location data back to a “command and control server” every 60 seconds.

Beer said Google had informed Apple of the attacks in February, and Apple subsequently released a security patch for the iOS 12.1. Long the driver of Apple’s money-making machine, iPhone revenue overall was down 12% from last year to $26 billion.

The tech giant sent out invitations on Thursday to a September event at its Silicon Valley campus where it is expected to unveil a new-generation iPhone.

‘Working on economic concerns’: Piyush Goyal

BENGALURU: Union minister for railways and commerce Piyush Goyal said there are concerns around the Indian economy, but it hasn’t slipped into recession, and the government is working to revive sentiments.
“Recession is the stage when growth disappears. Whether growth is 7% or 6.7%, it does not fit the R-word. Certainly, there are concerns and we are conscious of our responsibilities. We have been on an overdrive on setting the right policy agenda and improving the framework to help domestic manufacturers,” Goyal said at Times Network’s first South chapter of its signature event, the India Economic Conclave, held in Bengaluru on Friday.
Themed ‘India’s growth engine‘, the conclave witnessed the participation of business and political leaders, including Karnataka chief minister B S Yediyurappa, deputy CM C N Ashwath Narayan, Bibek Debroy, chairman of Economic Advisory Council to PM, and Biocon CMD Kiran Mazumdar-Shaw.
Goyal said there are macro-economic headwinds globally. “The entire world is going through a tumultuous period. The US and China are engaged in a trade war. The established rule-based system in the world is under stress,” he said in a conversation with Times Now managing editor Navika Kumar.
Goyal said the government is stopping a number of practices which, for many years, gave an artificial sense of well-being.

IL&FS gets 14 bids for 10 road assets

NEW DELHI: Crisis-hit IL&FS on Friday said it has received 14 binding bids for 10 road assets in its domestic roads transportation vertical. These assets account for total debt of over Rs 17,700 crore, which is nearly 19% of total debt of the group. It said there were multiple bidders for these assets.
These include one green, five amber and four red assets. The process for inviting binding bids for the road assets was launched through a public advertisement inviting expressions of interest. The comprehensive process included detailed due-diligence, in addition to organising site visits, across project sites spread across various states.

In another key development, the NCLT, Mumbai bench in a recent order cleared the sale of seven operating wind energy SPVs of the IL&FS group to ORIX, Japan for an equity value of approximately Rs 593 crore. In addition, ORIX has also agreed to taking over the entire SPV debt totalling approximately Rs 3,700 crore.

RBI extends full KYC deadline for e-wallets

BENGALURU: The RBI has again extended – by six months – the deadline for prepaid instruments (PPIs), including digital wallets, to do full KYC of customers. The extension, which was announced a day before the deadline expired, will benefit prepaid and e-wallet issuers like Paytm, MobiKwik, Airtel Money, Amazon Pay, Ola Money and PayU.

If the RBI had not extended the deadline, millions of Indian users would have on September 1 found restrictions or complete blockage of their mobile wallet apps. For conversion to full KYC from minimum details, e-wallets were supposed to get users’ KYC completed by August 31. Fintech players were supposed to give users a one-time option to transfer their outstanding e-wallet balance to their respective bank accounts, if users failed to meet the deadline for providing required information.

The extension has come as a relief for the players in the e-wallet business. Mahendra Nerurkar, co-chair of PPI committee and CEO, Amazon Pay, said, “We hope the government will soon come out with clarity on e-KYC via Aadhaar or any other remote fully non-face-to-face digital KYC method to enable PPI industry players to perform this conversion effectively.”

The earlier deadline was February 1, but the RBI extended it after hearing a series of appeals from fintech companies. E-wallet players suffered a setback after an SC directive on Aadhaar prohibited its usage by private players for e-KYC. This forced digital wallet companies, which had obtained Aadhaar data from customers, to re-verify all those users physically. For e-wallets, the biggest hardship with compliance has been physical verification of the users’ documents, which can be painstaking and arduous.

In this transitionary phase, e-wallets like Freecharge and Amazon Pay were not allowing users, who had not completed KYC, to add money or withdraw from the e-wallet – though they permitted users to utilise existing balance for merchant transactions.
Relief for offline UPI transactions
The National Payments Corporation of India (NPCI) has waived merchant fees for offline Unified Payments Interface (UPI) transactions of up to Rs 100 made using QR code scan-and-pay. Also, for large transactions, merchant fees have been capped at Rs 100. For other transactions, the merchant discount rate (MDR) has been hiked to 0.30% (maximum Rs 100). At present, it is 0.25% for transactions up to Rs 2,000. It will be 0.65% for transactions above Rs 2,000.

State-run bank mergers: How tech platform sealed the fate

NEW DELHI: For the last six months or so, officials in the department of financial services and the public sector bank brass had been brainstorming to move ahead with the long-pending consolidation plan. But it was not until Friday afternoon that even the bank chiefs were informed about the combinations that had been worked out by the government.

Finally, it was technology that settled the issue for at least four banks — Canara and Syndicate and Indian Bank and Allahabad. While Canara and Syndicate Bank were on the iFlex core banking system, Indian and Allahabad banks used BaNCS, prompting the finance ministry to go for these alliances for a smooth merger.

Big bank theory: 10 PSBs merged into 4 large entities

The merged entity comprising Punjab National Bank, Oriental Bank of Commerce and United Bank of India will become the second largest lender after SBI. The merger of Canara Bank and Syndicate Bank will create the fifth largest lender, with the Union Bank, Andhra Bank and Corporation Bank amalgamation at number six, based on business at the end of March 2019.

That left the government with the option to merge six entities that were on the Finnacle CBS platform into one, to create a mega entity, which it realised would be tough to manage. So, it opted to merge three entities each. But even here, there were several calculations at work, including political considerations.

While the government decided to bite the bullet on the banks headquartered in Kolkata, when it came to Bank of Maharashtra, the state elections were a factor that came into play in leaving it untouched, at least for the time being. It may have been a reason for leaving Bank of India and Central Bank of India to operate on a standalone basis, sources indicated. The attachment of the Sikh community to Punjab & Sind Bank meant that the government did not want to push its consolidation and retain the identity of the lender, where the unwritten rule is to have a Sikh chairman or managing director.

PSB mergers: Technology, HR synergy key challenges

The biggest challenge in implementing an amalgamation of public sector banks (PSBs) is the integration of technology platforms and managing HR & cultural issues, said bankers who have gone through a merger exercise.

But when it came to the six that had to be merged, various permutations and combinations were used to decide on the exact combinations. So, United Bank of India’s strong current and savings bank account (CASA) base of 51% against Oriental Bank of Commerce’s 29% meant that they could complement each other. Similarly, there were geographical considerations too. Punjab National Bank and OBC had a strong presence in the North but were largely missing from the East and the Northeast, where United Bank is deeply entrenched.

PNB’s return to profit paved the way for it to play the anchor in one of the merged entities. In the previous round, Bank of Baroda was asked to take the lead as PNB was bleeding due to a massive NPA pile and the fraud orchestrated by Nirav Modi and Mehul Choksi.

In case of the other three-way merger involving Union Bank, Andhra Bank and Corporation Bank, there are several synergies at work.

Big bank theory: 10 PSBs merged into 4 large entities

NEW DELHI: Fifty years after bank nationalisation, the government on Friday announced the biggest overhaul in the public sector space with finance minister Nirmala Sitharaman unveiling a mega plan to merge 10 state-run lenders into four large entities, capable of meeting the higher funding requirements of the economy and acquiring global scale.

Following the consolidation, the country will have 12 public sector banks, instead of 18 at present, with the merged entity comprising Punjab National Bank, Oriental Bank of Commerce and United Bank of India becoming the second largest lender after SBI.

The merger of Canara Bank and Syndicate Bank will create the fifth largest lender, with the Union Bank, Andhra Bank and Corporation Bank amalgamation at number six, based on business at the end of March 2019.

In 2017, there were 27 public sector banks, including IDBI, where LIC is now the majority shareholder. “Twelve solidly present, well-consolidated, energised, adequately capital endowed banks will now operate… Banks with a strong national presence and global reach is what we want,” Sitharaman said.

She also announced the contours of a Rs 55,000-crore recapitalisation plan for the entities that are to be merged as well as the six — Bank of India, Central Bank, Punjab & Sind Bank, Indian Overseas Bank, Bank of Maharashtra and Uco Bank — which are not part of the consolidation plan.

Bank gfx

Banks told to ensure no disruption in activities

The merger of Canara Bank and Syndicate Bank will create the fifth largest lender, with Union Bank, Andhra Bank and Corporation Bank amalgamation at number six, based on business at the end of March 2019.

Sitharaman’s second announcement in as many weeks comes at a time when the economy has slumped to its slowest pace in 25 quarters, prompting the government to unleash measures to speed up economic activity.

While bank consolidation has been on the agenda for over a decade, governments had dithered on moving ahead with it, fearing a backlash from the unions, which have lost teeth in recent years. Since coming to power five years ago, the Modi administration completed the merger of SBI associates with the parent, while merging Bank of Baroda, Dena Bank and Vijaya Bank earlier this year to create what is current the country’s second largest public sector bank.

The entire exercise was delayed as the state-run banks had seen massive loan impairment due to corporate defaults, pushing several of them into losses. While there were only four profitable public sector banks in the fourth quarter of 2018-19, 14 are now in the black.

While announcing the biggest amalgamation exercise so far, the government said banks have been asked to ensure that there is no disruption of banking activity and loan flow to the economy is not impacted. “This is exactly the right time to do it. It will not cause any disruption, we will draw upon the experience of the BoB merger,” finance secretary Rajiv Kumar said.

He also assured employees that there will be no retrenchment post-merger. Bankers, however, fear that they may be transferred to another part of the country as branch rationalisation is a certainty given that several urban centres have several branches at the same location.

All this is expected to play out only after a year or so as the process is expected to be time consuming. Over the next few days, boards of public sector banks will create the alliance proposal, which will be followed by consultations with the Reserve Bank of India. Then, the detailed merger arrangement will be worked out before regulatory clearances and board and government approvals are received.

At 5%, GDP growth slumps to 6-yr low in Apr-June

NEW DELHI: The country’s GDP growth slowed to an over six-year low of 5% in the April-June quarter, dragged down by manufacturing sector expansion of just 0.6%, sluggish financial services, farm and construction sectors and a slowdown in consumption.

Data released by the National Statistics Office (NSO) on Friday showed GDP growth in the April-June quarter, the first quarter of the fiscal year, slowed to 5%, lower than the 5.8% in the previous quarter and below the 8% in the first quarter of the previous year. The June quarter growth was the slowest since the March quarter of 2012-13, when the UPA was in office, making this the worst quarterly performance under the Modi government’s watch. The latest number is a 25-quarter low.

The data came on a day when finance minister Nirmala Sitharaman unveiled a mega bank merger plan, following up on the measures announced last week to give boost to the economy.

When asked about “the despondency in mood in the street” and “the government seeming to be in denial mode”, chief economic adviser Krishnamurthy Subramanian said, “The words being used are associated with periods of recession. We need to be careful what we’re talking about.There’s a slowdown but we still are at 5% in a global economy that’s not doing very well.”

GDP gfx

The government has also boosted its arsenal to stimulate growth with the transfer of Rs 1.76 lakh crore from the Reserve Bank of India (RBI). Sitharaman, however, said the government would take a call on how to spend the additional money that has poured in from the central bank.

In the past few months, several indicators have posted sluggish numbers. Several key sectors such as automobiles have faced the brunt of the slowdown leading to job losses and a cutback on production by companies.

The slowdown in the economy has been visible for the past few months with several indicators pointing to a contraction or posting sluggish numbers.

Slowdown in auto led to loss of jobs

Several key sectors such as automobiles have faced the brunt of the slowdown leading to job losses and a cutback on production by companies. The RBI has cut interest rates for four consecutive times to counter the slowdown in the economy and there are hopes that growth may pick up in the coming quarters.

“The slowdown in growth is due to endogenous and exogenous factors,” said Subramanian while analysing the data. “The government is alive to the situation and has taken several measures including mega merger of banks,” the government’s chief economist said.

image (8)

The sharp slowdown in the June quarter also triggered a political war of words between the opposition and the ruling party. “It is clear that the country is heading towards a major recessionary phase,” Congress spokesperson Gourav Vallabh said.

Sitharaman, however, hit back saying that inflation had skyrocketed during Congress-led UPA’s tenure. The latest data showed manufacturing sector growth slowed to a two-year low of 0.6%, sharply below the 12.1% growth in the first quarter of the last fiscal year, which indicates muted demand and slowdown faced by the corporate sector.

The farm sector grew by 2% in the June quarter, below the 5.1% recorded in the previous year’s first quarter and economists attributed it to floods in some parts of the country, the high base of last year and impact of uneven rainfall on the segment.

Some economists advocated more fiscal measures to boost growth and tame the slowdown as interest rate cut may not be enough to revive growth. “The contemporary issue for macro-economists is to focus on assuring adequate aggregate demand. We believe it is incorrect for central bankers to suggest that they have this challenge under control or with their current toolkit they will be able to get it under control. Fiscal policy needs to be a major focus, especially given what the low or negative interest rates mean for the sustainability of deficits,” said Soumya Kanti Ghosh, group chief economic adviser at State Bank of India.

Several economists pared their expectations for GDP growth for the current fiscal year which will end in March 2020, and estimated the economy to grow at 6.7%-6.8%, although they expect a growth pick up on the back of the government’s reform measures. “The government has announced a slew of measures to boost confidence among investors and consumers. The government has also indicated at frontloading of the capital expenditure to provide an additional boost to the economy,” said Madan Sabnavis, chief economist at CARE Ratings.

Udaan gets $300 million from Altimeter, GGV, others

BENGALURU: Udaan, an online marketplace that supplies products and gives loans to small merchants, has raised $300 million (Rs 2,143 crore) from a mix of new and existing investors. Silicon Valley’s hedge fund Altimeter Capital, venture capital fund GGV Capital, and existing investors like DST Global and Lightspeed Venture Partners have pumped in new capital in the Bengaluru-based startup, regulatory filings from Singapore showed.

This round is expected to go up to $500 million (Rs 3,572 crore) in size, as TOI first reported in its July 29 edition. The company is now being valued at $2.3 billion, according to calculations from business intelligence platform Paper.vc, which shared the regulatory documents. Udaan’s latest valuation is almost double from its previous financing round, when it raised $225 million (Rs 1,607 crore) last year.

Started by former Flipkart executives in 2016, Udaan has emerged as one of the largest online business-to-business (B2B) commerce platforms. The investment is made via Singapore-registered Trustroot Internet, the holding company of Udaan. Udaan co-founder Sujeet Kumar did not comment on the development.

There is a possibility of a new strategic investor joining the financing round, but those details have not been formally submitted yet. Udaan will be using the new capital to feed its expansion plans and scale up its lending business for merchants.
The new financing round also comes at a time when B2B startups have emerged as a favourite for investors. Tiger Global, the US-based investor, has been making a series of investments across different B2B companies here.
Udaan is said to be clocking about $200-million monthly sales across product segments like vegetables, smartphones, fast-moving consumer goods (FMCG), fashion, dry grocery, and electronics. Udaan has a network of about 2 million retailers or kiranas across 900 cities. It has a base of 25,000 sellers, a mix of small manufacturers, wholesalers and established consumer brands.
While Udaan is expanding across the country, players like US-based Walmart, Amazon, Chinese e-commerce major Alibaba and homegrown Reliance have also lined up aggressive plans to scale up operations in India.