- The Bharatiya Janata Party’s four-day old government collapsed in Maharashtra, bringing an end to a political crisis in India’s second most populous state. A ban by market regulator on Karvy Stock Broking from having new clients and executing trades for allegedly misusing client securities unnerved India’s retail investors. Subhash Chandra, who ushered in the cable TV revolution in India with Zee TV, stepped down as chairman of the board at the company he founded three decades ago. Here is more about what made news in politics and business this week.
- Subhash Chandra resigned as chairman of his flagship company Zee Entertainment Enterprises Ltd (ZEEL), making way for the company to become an institutionally managed entity. Chandra will continue as a non-executive director on the company’s board and his son, Punit Goenka, will continue as managing director and chief executive officer of ZEEL.
- Paytm raised a billion dollars (Rs 7,200 crore), at a valuation of $16 billion, from current and new investors, enabling the digital payments firm to strengthen its finances to spread in India as it competes with Google Pay and Walmart Inc.-owned PhonePe. With this funding round, the Vijay Shekhar Sharma-led fintech giant has become a top-tier Asian digital firm.
- A government committee set up to suggest help for India’s telecom sector was disbanded, indicating that the two-year moratorium on spectrum fees is all that companies will get for now. The government, on the recommendations of the Committee of Secretaries, last week cleared a two-year moratorium on payments for spectrum bought in auctions, a move aimed at providing cash flow relief to carriers such as Vodafone Idea and Bharti Airtel.
Number Of The Week
- 830 days: The time it took for the Essar Steel case to be disposed of. A large number of cases –535 at the end of September – are stuck in the insolvency courts beyond the stipulated time frame of 270 days.
- The recent Supreme Court judgement in the Essar Steel case established the primacy of financial creditors over operational creditors in the resolution process.
- While this judgement brings some cheer to banks, they cannot afford to turn complacent as insolvency courts have failed so far to resolve cases in a speedy manner.
- The Supreme Court bench has also clarified that while 330 days is the outer deadline within which a corporate resolution plan must be given shape, exceptions can be made on rare occasions in which a case is on the verge of being finalized.
- After the Supreme Court judgement, however, it is expected that cases before the National Company Law Tribunal (NCLT) and appeals
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A few links for further reading
Hard path to growth
The signals for the economy are not positive: overall demand is yet to pick up; the share of total exports in India’s GDP is declining, and industrial output pattern remains worrying.
Small savings scheme
Investors breathed a sigh of relief when the government announced that interest rates on these instruments would not be revised for the fourth quarter of the calendar year.
Invest and emigrate
The great Indian dream of settling abroad is achievable if one has a few crores to invest. Rich nations offer a variety of investment options in a quid pro quo arrangement: immigrants get a better quality of life and revenue from them helps these countries’ finances. Wealthy Indians, troubled by polluted cities and the red tape holding up entrepreneurship, may want a quick ticket out of the country. Sanjay Kumar Singh lists a range of options: from a Canadian province’s investor programme to America’s US EB-5 plan.