Times top10

India-Australia virtual bilateral summit; Questioning of 32 accused in Babri demolition case to begin; Air India’s flight to bring back stranded Indians from New Zealand; Anniversary of Tiananmen Square protest, crackdown; Opec+ members likely to discuss extending oil cuts

• Pandemic: India registered a record single-day rise of 8,723 new Covid-19 cases on Wednesday, even as 254 more people died, taking the cumulative fatalities to 6,079. With 122 deaths, Maharashtra accounted for 48% of the country’s casualties on the day, followed by Delhi (50 deaths), Gujarat (30), Tamil Nadu (11) and Bengal (10). The number of total cases in the country stood at 209,468.
• Policy approval: The Union Cabinet on Wednesday approved the amendment to the Essential Commodities Act to allow the farm sector to decide on procurement and stocking of cereals, pulses, oilseeds, edible oils, onion and potatoes based on market conditions; the law had earlier set curbs on stocks. Cabinet also approved the Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020, to give farmers greater choice in selling their produce, removing the restriction that hitherto tied the sales to notified agricultural produce markets committees (APMC). These measures were first introduced by finance minister Nirmala Sitharaman as part of the Rs 20 lakh crore package.
• The defence ministry office at Raisina Hill was unsettled on Wednesday after secretary Ajay Kumar tested positive for Covid-19. Defence minister Rajnath Singh and some other top military and civilian officers reportedly kept away from the premises following the news.

Oh, if grim news were in short supply... a mild earthquake of 3.0 magnitude struck Noida, Uttar Pradesh, on Wednesday evening, with tremors felt across the National Capital Region. This was the sixth earthquake in Delhi NCR since April 12.

Relief for Shah Faesal, the former IAS officer and chief of J&K People’s Movement, and two senior members of the People’s Democratic Party — Peer Mansoor Hussain and Sartaj Madani — as the J&K administration revoked the Public Safety Act against them, setting them free after nearly 10 months.

The United States is to open a trade investigation into the digital services tax introduced by several countries, including India. “President Trump is concerned that many of our trading partners are adopting tax schemes designed to unfairly target our companies,” US Trade Representative (USTR) Robert Lighthizer said.

What you need to know:

• Corporate taxes are levied on profits. But multinational companies often move profits, through smart accounting, to low-tax jurisdictions. This age-old practice has exacerbated since the onset of tech companies.
• Nearly all of the major tech firms, from Apple to Google to Facebook, have their European headquarters in Ireland, which levies lower taxes than other major European Union countries.

Dive deeper:

• There’s a legal loophole called “Double Irish, Double Sandwich”. This includes US firms setting up subsidiaries in Ireland, which will hold royalty rights to its products. Now, every time a sale is made in the US, royalty fees are paid to the Irish subsidiary — effectively moving the profits in the US to Ireland. The Irish subsidiary then moves the profits to an offshore company, where they remain untaxed. Similarly, profits from sales in the EU are routed through Irish and Dutch subsidiaries. Google and Apple have done so.
• An Indian example: In November 2018, the Economic Times reported that Google India remitted a total of Rs 16,119.6 crore ($2.18 billion) over five years — 50-60% of its revenue over the period — to its parent company's subsidiaries in Singapore and Ireland towards “purchase of advertising space”. The company marked this as “miscellaneous expenses”, thereby reducing its profits here.

The blowback:

• In 2016, the European Commission ordered Apple to pay nearly $15 billion to Ireland for having received “illegal tax benefits” over two decades. Apple has challenged the order.
• Last July, France enforced a digital tax of 3% on revenues of large internet companies — revenues cannot be moved as easily as profits. As many as 21 nations have some sort of digital tax, the KPMG said this month.
• More broadly, the Organisation of Economic Co-operation and Development (OECD) has proposed an overhaul in the global taxation system; “the current rules dating back to the 1920s are no longer sufficient,” it said (pdf here).
• Since 2016, India has charged an equalisation levy, a 6% tax on ad spends of technology companies. The Centre collected Rs 900 crore in FY19. India now plans to charge a 2% levy on overseas e-commerce firms shipping goods to the country.

But.. these efforts have displeased the US, which says it harms American companies. France, in particular, has faced a lot of heat.

The bottom line: India and the US are closer than ever — Quad, expanded G7 and all that — but that does not paper over some thorny issues, especially ones that cost. Diplomacy, after all, is not a zero-sum game.

• As the death of a 15-year-old pregnant wild elephant sparked outrage nationwide, the Kerala Forest department has launched a 'manhunt' for the perpetrators. “It is certain that she was offered the pineapple filled with firecrackers to eliminate her. “I have directed the forest officials to nab the culprit. We will punish him for 'hunting' the elephant," principal chief conservator of forests (wildlife) and chief wildlife warden Surendrakumar told news agency PTI.
• Samuel Pachuau, the wildlife warden of the Silent Valley National Park, Attappadi, where the incident occurred, added: "We are quite certain to find the perpetrators of this crime, which is in no way acceptable at all. It was on the 23rd of last month we came to know about this incident, when the elephant was spotted near a water source outside the park.”
• However, according to a government official it could be difficult to gather information. That’s because locating the place where the crime may have been committed isn’t easy, given that elephants usually travel several kilometres a day. “The incident comes to the notice of forest officials after the ill-fated elephants are found alienated from their herds, that too weeks later. This makes the probe tough," he added.
• Reportedly, another female elephant had met with similar fate in April in the Pathanapuram Forest Range Area in Kollam district. A senior officer said the elephant was found in a serious condition from the fringe areas of the forest by officials in April. Kerala’s forest minister K Raju has sought a report from the top wildlife officials about the incidents of elephant deaths.
• Elephants enjoy the highest status of Schedule I species in the Wildlife Protection Act of India, 1972, but unfortunately the situation on the ground is completely different. Only about 27,000 wild elephants remain in India. The country is home to over 50% population of Asian elephants in the world, making it the last stronghold of the species.

• Alert! Poaching cases have gone up by 151% in India during lockdown, a report released by global wildlife trade monitoring network TRAFFIC said on Wednesday. The report Indian wildlife amidst the COVID-19 crisis compared six weeks before the lockdown (February 10 to March 22), the baseline, and six weeks in lockdown (March 23 to May 3). And while it wasn’t restricted to or higher in any geographical area, the number of poaching cases went up from 35 to 88 in the period.

Search engine Google is being sued for $5 billion in a class action suit filed in a California court for violation of its users’ privacy, even when they browse in the incognito mode. A similar case was filed last week too. So what wrong has Google committed?

• Eyes on you: The suit alleges that “Google tracks and collects consumer browsing history and other web activity data no matter what safeguards consumers undertake to protect their data privacy”, such as in the incognito mode and thereby gains “a complete, cradle-to-grave profile” of the users without their consent. Among other things, it accuses Google of “collecting, at minimum, the consumer’s IP address, browser and device information and the webpage content that the consumer is actually looking at”.
• What’s incognito mode: Google’s incognito mode offers people the chance to keep their browsing history private, especially on shared devices, claiming that none of a user’s “browsing history, cookies and site data, or information entered in forms are saved” on the device. It also adds that even “Chrome doesn’t tell websites, including Google, when you're browsing privately in Incognito mode”.
• However...Google also cautions users that their browsing history even in incognito mode is still visible to their school, employer or their internet service provider. It also says that the incognito mode doesn’t “prevent the websites you visit from serving ads based on your activity during an incognito session”.
• The billions: The petitioners however contend that not only is Google’s snooping in on their browsing history in incognito mode, but that the company was benefitting monetarily from this privacy breach. According to the petitioners, Google has collected and sold off its users’ personal information to third party advertisers — with data on web browsing histories fetching $52 per year as per a study cited in the suit, with the highest value reserved for details like Social Security Number, which is worth $240, while credit card details are worth $150.
• The penalty: The petitioners say that since Google has violated the privacy of people numbering in multiples of million, each should receive more than $5,000 at the very least — which would make the minimum payout due $5 billion, if Google loses. However, considering that there are 1.5 billion active account users....you can do the math!

• Lam said: Carrie Lam, the chief executive of Hong Kong has accused the international community of double standards in dealing with the protests in the city. “I can only say that the international community and some of the foreign governments have been adopting blatant double standards in dealing with this matter and commenting on this matter,” Lam said in Beijing, where she held talks with the Chinese government. “It is within the legitimate jurisdiction of any country to enact laws to protect and safeguard national security. USA is no exception. UK is no exception,” Lam added. The statement came after British Prime Minister Boris Johnson laid out a visa offer to nearly 3 million Hong Kong citizens.
• Beijing said: The protest against police brutality and racial inequality in the US has allowed China to push back against the criticism it has faced over Hong Kong, no matter that much of the world is being informed of the proceedings in the US by the US media — unlike China’s case. In a report, the state-run Global Times quoted a representative of All-China Youth Federation, a youth organisation linked to the Chinese Communist Party, as saying; “the Hong Kong police adopted much more humane and more restrained measures than the US police currently does. The strategy of Hong Kong police was simply to disperse the protesters, rather than to forcefully arrest all of them.” Chinese ambassadors and officials have also been hitting out at the US on social media.

Over in the US, defense secretary Mark Esper said he did not agree with President Donald Trump on deploying combat troops to contain the protests. “The option to use active-duty forces in a law enforcement role should only be used as a matter of last resort and only in the most urgent and dire of situations. We are not in one of those situations now,” he said.

Warner Music Group (WMG), the world’s third-largest recording label with an enviable roster that includes Ed Sheeran to Dua Lipa to Coldplay to Led Zeppelin to Megadeth, on Wednesday raised $1.93 billion in its initial public offering (IPO) on Nasdaq — the biggest listing in the United States this year. The company offered 77 million class A shares at $25 per share, valuing it at $12.75 billion. “Our cash position is robust, and our goal now is to come out the other side of the Covid-19 pandemic stronger than ever,” Eric Levin, Warner Music Group’s Executive Vice President and CFO, said in an interview. Worried about the pandemic? Listen to some music.

Saregama. Facebook has signed a global licensing deal with the RP Sanjiv Goenka Group of companies-owned music label, allowing users to choose from a large catalogue of Bollywood music for their Facebook and Instagram posts, it said on Wednesday. Saregama, which boasts more than 100,000 songs spanning 25 languages and sold vinyls and cassettes under the household name HMV for decades, did not disclose the financial details of the deal. Saregama’s deal with Facebook follows its licensing deal with Swedish music streaming service Spotify announced earlier this month.