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‘Ease Of Doing Business’ In India

 

IndiGo is adding to its fleet. India is getting better at Doing Business says the World Bank. Tata Teleservices paid over a billion to end dispute with the erstwhile partner NTT Docomo.

 

40% 

What is it? The percentage of seats that went empty on the Mumbai-Ahmedabad-Mumbai train route in the three-month period to September, according to the response of the Indian Railways to an RTI query.

Why is it important? This is the route chosen by the Central government to build India’s first bullet train project, with Japan’s help, at a cost of Rs 1,10,000 crore. Critics of the project argue that, instead of investing in one high-speed line, the money can be better spent on multiple projects whose benefits reach more Indians.

Tell me more: For 2017-18, the total capital and development expenditure of the Indian Railways has been earmarked at Rs 1,31,000 crore, of which, Rs 55,000 crore is due to come from the Central government.

 

141

What is it? The number of aircraft in the fleet of IndiGo, as of September 2017. That’s an increase of 6 aircraft over June 2017 and 23 over September 2016.

Why is it important? At its Q2 results yesterday, India’s number one domestic airline reported a four-fold increase in net profit on a year-on-year basis to Rs 552 crore, partly driven by a 25.7% increase in passenger revenues. This increase comes in the lean season, which shows it is being able to sweat its assets.

Tell me more: The net profit was partly aided by compensation from Pratt & Whitney and Airbus for grounding of planes and delivery delays.

 

34%

What is it? Share of Mauritius in the $43.4 billion foreign direct investment (FDI) that came into India in 2016-17.

Why is it important? Uttar Pradesh chief minister Yogi Adityanath is today flying to Mauritius on a three-day visit, during which he will participate in an event of non-resident Indians and invite them to invest in the state. Last month, he hosted a 50-member industry delegation from the US.

Tell me more: The share of the Kanpur regional office of the central bank, which covers UP and Uttarakhand, in FDI inflows in 2016-17 was just 0.2%.

 

30

What is it? The number of positions that India gained in the 2018 Doing Business rankings released by the World Bank yesterday.

Why is it important? This study assesses countries on 10 parameters, and India posted an improved score in each, with the biggest jumps coming in ‘paying taxes’, ‘getting credit’ and ‘resolving insolvency’.

Tell me more: The World Bank survey is based on the situation in New Delhi and Mumbai. A state-level survey of 3,276 manufacturing firms by NITI Aayog-IDFC Institute, released in August, documented improvements but also reported challenges in doing business.

 

$1.27 billion

What is it? The amount that Japan’s NTT Docomo said on Tuesday it has received from Tata Sons as arbitration, awarded last year for its 21.6% stake in Tata Teleservices.

Why is it important? The transfer ends the dispute between the erstwhile joint venture partners and paves the way for the merger of the loss-making consumer-mobile business of the Tata Teleservices with Bharti Airtel.

Tell me more: A stated goal of Tata Sons executive chairman N Chandrasekaran is rationalisation of the group’s businesses, with an approach that pivots around 5-7 groups than 110 companies.

 

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News in Numbers, Mar 01, 2017: Saying ‘Tata’ to DoCoMo

$1.18 billion

 

What is it? The amount Tata Sons will pay Japanese telecom firm, NTT DoCoMo for its stake in their Indian joint venture.

 

Why is it important? This ends the dispute between two former partners in the telecom venture. The settlement was 60% lower than what DoCoMo demanded initially in a London court. The resolution was finally done in an out-of-court settlement.

 

Tell me more: DoCoMo had decided to withdraw from India in 2014 but a pre-determined price of either half of its original investment of $2.2 billion in 2009 or a fair market value was opposed by India’s central bank. Unable to find another buyer, Tata Sons had offered to buy back the stake which was devalued by a PWC audit.

 

 

4.4%

 

What is it? The official estimated rate of growth of the farm sector (agriculture, forestry and fishing) in fiscal 2017.

 

Why is it important? The sector, 60% of which is made up by crop output including fruits, vegetables and grains, contributes 16.11% to India’s Gross Added Value (GVA). But the expected growth above 5% after two years of drought is still elusive.

 

Tell me more: Production of food grains in the Kharif and Rabi seasons of 2016-17 grew by 9.9% and 6.3%, respectively, compared to the decline of 2.3% and growth of 2.0%, respectively, in the previous year.

 

 

$5.37 billion

 

What is it? The valuation of Flipkart by one of its investors, Morgan Stanley Institutional Fund Trust, as revised by it in the December, 2016 quarter.

 

Why is it important? Morgan Stanley is the fifth investor to revise downwards the valuation of Flipkart, India’s largest e-commerce player. It did it for the fifth time. Other investors such as Fidelity, T Rowe Price, Valic Co and Vanguard have cut their estimates of Flipkart’s value over the past year as well.

 

Tell me more: Flipkart’s valuation from its last funding had stood at $15 billion. It is now looking to raise $1.5 billion, according to reports, valuing the company at $10-12 billion.

 

 

6

 

What is it? Number of engine snags reported in Airbus ‘A320neo’ in the last one month, forcing India’s civil aviation regulator to start an investigation.

 

Why is it important? Though only 21 A320neo are operated in India by Indigo and GoAir, these two airlines have cumulatively ordered 500 jets of this model mainly on account of superior fuel efficiency.

 

Tell me more: Indigo, the market leader, will go ahead with planned expansion of its fleet despite the latest snags in engines manufactured by Pratt & Whitney. Airbus launched ‘A320neo’ in January last year.

 

 

Up to 1.0 degree Celsius

 

What is it? India will experience higher than normal (up to 1.0 degree C) temperature in the summer months of March-to-May, according to the Indian Meteorological Department

 

Why is it important? Above normal temperature impacts monsoon and causes heatwave conditions. Last year was the warmest on record since 1901, but India experienced normal monsoon in 2016 after two consecutive droughts in 2014 and 2015.

 

Tell me more: More than 700 people died last year because of heatwave conditions in India.

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News in Numbers, June 24, 2016: CNG-powered two-wheelers in India, voters say yes to Brexit…

10

What is it? The number of popular iconic places that will be cleaned up/maintained to international standards. It includes Taj Mahal, Jagannath Temple, Tirupati and Chhatrapati Shivaji Terminus.

Why is it important? If successful, it would provide a fillip to tourism, to the Indian government’s Swachh Bharat Mission and could have a trickle-down effect on the other monuments and religious structures. At a two-day workshop next month, experts would be consulted to make site-specific plans, fix international standards and decide on the timeline and financial resources required. The World Bank would provide technical assistance for the same.

Tell me more: Besides these iconic places, the government is working on creating standard operating procedures to improve cleanliness in popular national parks, sanctuaries and tiger reserves including Coringa Wildlife Sanctuary, Gir Wildlife Sanctuary and Flamingo Sanctuary.

 

$1.17 billion

What is it? The amount Tata Sons has been ordered by the London Court of International Arbitration to pay to Japan’s largest mobile-phone carrier NTT Docomo for breach of an agreement over Tata Teleservices.

Why is it important? This is a victory for Docomo, though it’s unclear if Tata Sons would make the payment. In 2014, Docomo had exercised its right to ask Tata Sons to find a buyer for its stake at a fair price of 50% of the acquired cost (whichever was higher). However, Tata failed to find a buyer and India’s central bank did not allow it to buy the stake due to a rule that prevents foreign buyers from selling their stakes in Indian companies at a predetermined price.

Tell me more: Docomo paid $2.6 billion in 2009 and 2011 for a 26.5% stake in Tata Teleservices.

 

50

What is it? The number of Honda Activas that would be retro-fitted with CNG (compressed natural gas) kits as part of the government’s pilot programme.

Why is it important? This is the first time that India will have two-wheelers running on CNG to determine their efficiency and emission rates. Based on its success, this would be available for the public. The CNG-vehicles would have 75% and 20% less hydrocarbon and carbon monoxide emissions (according to the manufacturer of the kits) and the running cost on CNG is estimated to be 40% lower than that of petrol.

Tell me more: The CNG kits are made by the Indian arm of Iranian firm ITUK Manufacturing at its Pune factory and the pilot is being conducted by GAIL (India) and Indraprastha Gas Ltd. The retrofitted two-wheelers would be given to the delivery boys of Domino’s Pizza for free.

 

71

What is it? The number of BSE 100 companies that fully complied with disclosure norms in 2015, according to India Disclosure Index 2016 by FTI Consulting.

Why is it important? This is up from 41% in 2015, suggesting better compliance of reporting and disclosure rules by the top 100 large-size companies on the Bombay Stock Exchange, though still nearly a third are not up to the mark. Just 3% of the top 100 companies had mandatory disclosure scores of less than 2.5 (out of 4) compared to over half of the companies scoring lesser than 2.5 in 2015.

Tell me more: In terms of voluntary disclosure, the average score of the BSE 100 companies marginally improved from 3.5 (out of 6) in 2015 to 3.7. However, over three-fourths of the companies did not provide enough information on risk management metrics while 37% did not provide convenient whistleblowing mechanisms to report fraud or unethical practices in their firms.

 

51.8%

What is it? Percentage of voters who want the United Kingdom to leave the European Union (at around 10 am Indian time).

Why is it important? Though this is not legally binding, the government may not go against the will of the people expressed in the referendum. It is the first time that a full member has voted to leave the 28-nation political and economic union. Those favouring the exit argue that the UK would be free from the EU’s undue bureaucratic, legal and financial control and prevent the free movement of EU nationals into the UK. Those against leaving fear that UK’s economy would be hit, jobs would be lost and the rate of growth would go down to 3-6%.

Tell me more: The Brexit may affect the 800 Indian companies in the UK, which employ over a lakh people. The annual profit of Jaguar Land Rover, owned by the Tata Group, is reportedly estimated to decline by around $1.47 billion in the next 10 years.

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