Morning Scan: All the big stories to get you started for the day

PMO to step in for consensus on e-commerce rule changes

The Prime Minister’s Office is in consultations with the consumer affairs ministry regarding proposed amendments to the e-commerce rules, The Economic Times reported.

Why it’s important: This is to build consensus with various stakeholders, especially government arms on the amendments.
A draft of amendments had released in June.
The draft guidelines seek to strengthen consumer protection and tighten rules for e-commerce marketplaces.

It also includes barring affiliated entities from selling on their platforms, as well as restricting flash sales — the discounts or promotions that eCommerce firms offer for a short duration.

 

Crypto may be allowed as asset, not as currency

The government is unlikely to make crypto as currency to settle transactions and make payments but could be held as an asset like shares, gold or bonds, The Economic Times reported.

Why it’s important: The regulators are also planning to ban active solicitation by companies including exchanges and platforms.
The Sebi could be designated as the regulator.

The government is also working on the taxation aspects.

Meanwhile, Crypto exchanges WazirX and Bitbns have decided to abstain from putting out ads, amid discussions of a possible regulatory clampdown of the cryptocurrency sector.

 

Air travel may maintain Diwali heights: IndiGo CEO

IndiGo CEO Ronojoy Dutta said that the air traffic during this Diwali was ahead of the expectations, The Economic Times reported.

Why it’s important: He said the demand will be continuing till next March.
The main reason for the uptrend is that Indians fly to their favourite leisure destinations and to meet family and friends with Covid numbers declining and more people getting fully vaccinated.
Business travellers are also returning to their pre-Covid levels.
However, IndiGo hasn’t been able to swing back to profit, even operationally, because international flights haven’t fully resumed and the price of fuel has surged.

The CEO also said that fares will remain firm, as the “input costs for airlines have increased substantially.”

 

Baring-owned Coforge to sell $750 million stake in ADR listing

Shareholders of Coforge Ltd, formerly known as NIIT Technologies, including its controlling owner Baring Private Equity Asia, will sell securities worth as much as $750 million in a proposed American Depositary Receipts (ADRs) offering in the US, Mint reported.

Why it’s important: The principal purposes of this offering are to create a public market for the ADSs.
Also to facilitate future access to the public equity markets.
An ADR can represent one or more shares of a foreign company that seeks to access the US capital markets.
Coforge filed an offer document informing the stock exchanges that its shareholders will sell ADRs in a US IPO.
The company will not receive any money from the sale.

Minority shareholders of the company can also participate in the secondary share sale.

 

Crypto exchanges may be classified as e-com platforms

The government is looking at classifying cryptocurrency exchanges as e-commerce platforms, Business Standard reported.

Why it’s important: It also plans to impose 1 per cent tax collected at source on them under GST.
Cryptocurrency exchanges have been proposed to be classified into three categories: facilitator, brokerages that allow buying and selling, and trading platforms that provide an interface for trading.
The use of blockchain technology may be treated as export; tax can be brought down gradually.

The tax collected at source by crypto platforms can be set off against investors’ tax liability.

 

Repayments are not a cause for concern: Karur Vysya Bank CEO

Bramesh Babu, MD and CEO of Karur Vysya Bank, in an interview with Business Standard, said that rain havoc in the South is not going to affect them very badly.

What he says: KVB has a diversified portfolio with about 60 percent of agri advances from Tamil Nadu.
As far as our agri portfolio is concerned, there will not be any major issue on account of the rain.
For small businesses, it is a temporary setback and business as usual will happen from next week onwards.
The bank has a lot of exposure in textiles and this sector is doing very well because of the impact on the account of China too.
Other downstream industries connected to textiles have also flourished.
For loans, very few cases have come for restructuring requests.
Repayments are not a cause for concern for the bank.
The need for having a branch has come down to some extent due to digitalisation.

However, to improve branch presence during the year, KVB is planning to open 15 branches.

 

India, UK may finalise a full FTA without an early harvest

India and Britain may conclude a full free trade agreement without resorting to an interim deal, Hindustan Times reported.

Why it’s important: Talks between New Delhi and London on the FTA are on the fast track.
India may not insist on a two-stage trade deal with the UK—an early harvest arrangement followed by a comprehensive pact if all issues are adequately addressed.
Negotiations will start soon and the British side has indicated that it prefers that the talks lead to a comprehensive pact.
Britain opened up its fisheries sector to more Indian players, facilitated more opportunities for nurses, recognised Indian seafarers’ certificates and entered a joint dialogue on a social security agreement.
India will lift restrictions to enable British fruit exports and improved access to medical devices.

The two sides will also work toward reciprocal opening up of legal services.

 

Real capex will revive in 9-12 months: Axis Bank CEO

Amitabh Chaudhry, CEO & MD, Axis Bank, in an interview with The Economic Times said that there is a signal for the revival of credit offtake.

What he says: The festive season has been better than what was expected.
Optimism is returning, there have been a lot of conversations around incremental capex which will take place soon.
Some of them have announced investment plans but the real capex will start coming in only in the next 9-12 months when the credit offtake will start.
The possible third Covid wave is still a concern as Europe is witnessing the fourth wave.
There are supply chain issues, this is impacting India also especially the car industry.Commodity prices remain high.