The idea floated by high-profile entrepreneurs, seeking dual-class share structure along with differential voting rights for founder-promoters of startups, is flawed. The Government must look for better ways to help small businesses An advocacy group, IndiaTech, representing some of the most high-profile entrepreneurs, has made a submission to the Ministry of Corporate Affairs (MCA) and the markets regulator, Securities Exchange Board of India (SEBI), seeking a dual-class share structure along with differential voting rights for founder-promoters of start-ups that can encourage the country’s most valuable companies to get listed on the domestic stock exchanges instead of overseas exchanges such as Nasdaq and New York Stock Exchange (NYSE). At present, the Companies Act 2013, permits firms having consistent track record of distributable profits...
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Category: Growth & employment
PSBs turnaround – make it sustainable
After incurring losses for four consecutive years [2015-16 to 2018-19], public sector banks [PSBs] are expected to post profits in the range of Rs 23,000 – 37,000 crore during 2019-20. Their gross non-performing assets [GNPAs] are slated to decline from 10.3% as on March 2019 to 8.1 – 8.4% by March 2020. The net NPAs [NNPAs] are projected to go down from 5.3-5.4% to 3.5-3.6% during the same period. Four years ago when the NPAs started showing an unprecedented increase compelling the banks to make provision in the balance sheet – as prescribed by the banking regulator viz. Reserve Bank of India [RBI] – and resultant losses, no one would have ever thought that the turnaround would come so soon. Yet,...
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Protectionism hurts e-commerce
Instead of the extreme steps proposed by a new policy, the government should consider a pragmatic and flexible arrangement to address the concerns on protection of sensitive data With increasing penetration of internet, surging middle-class and focus on customer convenience and affordable pricing, online retail commerce in India has grown at a phenomenal 70 per cent during the last five years reaching about US $40 billion during 2017. This is projected to increase five-fold to US $200 billion by 2026. Much of the growth has been driven by foreign majors such as Amazon,Walmart/Flipkart and so on under a policy notified in 2016-17 which allowed 100 per cent foreign direct investment (FDI) in the marketplace model of e-commerce. The marketplace is an...
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Union Budget: The way forward
Three important highlights of the Interim Budget presented by Piyush Goyal at the beginning of this month are: (i) Under PM Kisan Samman Nidhi, the Centre will give Rs 6,000 per year to small and marginal farmers (land holding up to two hectares) to be deposited directly in their account to benefit a total of 120 million. The support is with effect from December 1, 2018, and the first installment of Rs 2,000 was transferred to beneficiaries last Sunday; (ii) Under PM Shram Yogi Mandhan, persons working in the unorganised sector and earning less than Rs 15,000 per month will get a pension of Rs 3,000 per month on attaining 60 years. For this, a worker joining at the age...
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If populism can help Modi stay on, so be it
Three important highlights of the Union Budget – 2019-20 [interim] presented by Piyush Goyal, minister for railways and coal and ‘temporary’ in-charge of finance portfolio are: (i) Under PM Kisan Samman Nidhi, the centre will give Rs 6000/- per year to small and marginal farmers [land holding up to 2 hectare] to be deposited directly in their account to benefit a total of 120 million. The support will commence from December 1, 2018 with the first instalment of Rs 2000/- covering 4 months to be given immediately; (ii) Under PM Shram Yogi Mandhan, persons working in the ‘unorganized’ sector and earning less than Rs 15,000/- per month will get pension @Rs 3000/- per month on completion of 60 years age....
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Modi’s agenda for jobs
With the general elections only a few months away, the opposition parties have resurrected their attack on prime minister, N Modi for failing to generate 20 million jobs every year – that he promised during his campaign for 2014 elections. The tantalizing figure that arouses the emotions of common man in the street is being used by these parties as a potent weapon to ensure that Modi gets defeated even as they themselves have no vision – forget a comprehensive action plan – to create jobs. The contentious issue of what this prime minister has done and whether or not he has lived up to the aspirations of the youth in providing jobs of the required scale requires an objective...
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Stopping pilferage, enhancing welfare, boosting growth
Addressing NRIs and Indian-origin people at the inauguration of the 15th Pravasi Bharatiya Divas convention in his parliamentary constituency of Varanasi in Uttar Pradesh on January 22, 2019, Prime Minister Narendra Modi referred to former premier Rajiv Gandhi’s remarks on corruption in the country saying Congress that ruled for years did nothing to stop the “loot”, while his Government put an end to it and transferred about Rs 5,80,000 crore directly to the people under various schemes. Modi recalled what Rajiv Gandhi had stated “of the funds Central Government sends, only 15 per cent of that reaches the people. If one rupee is sent from Delhi, only 15 paise reaches the villages, 85 paise disappear. Even as the country’s middle...
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GST: falling revenues, rising populism
A major reason behind the body blow the BJP received in the recent assembly elections in three Hindi heartland states of Madhya Pradesh, Rajasthan and Chhattisgarh was the disenchantment among the micro, small and medium enterprises (MSMEs), which employ the maximum number of persons — next only to agriculture. These persons also account for a big chunk of the middle class. Sensing that MSMEs were affected due to faulty implementation of the Goods and Services Tax (GST), besides demonetisation, the GST Council at its 32nd meeting took decisions intended to give them major relief. These include: (i) increased the exemption limit from Rs 20 lakh to Rs 40 lakh (a business entity having turnover below this does not have to...
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Quota in jobs – go for economic criteria only
The decision of the Modi – government to give 10% reservation to ‘economically weaker section’ [EWS] of the society in educational institutions and government jobs [a constitutional amendment bill in this regard was passed on January 8/9, 2019] prima facie looks politically motivated. This is because the decision was taken towards the fag end of its term and impending general elections in April/May, 2019. Indeed, the 124th constitutional amendment bill was presented for consideration and passage by Lok Sabha [LS] in its last sitting on January 8, 2019. Further, the session of Rajya Sabha [upper house] was extended by a day to ensure its passage. The political significance of the decision can also be gauged from the fact that in...
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Lies – newly found enemy of development
Even as the Congress camp is filled with jubilation over the defeat of BJP in the three heartland states viz. Madhya Pradesh [MP], Rajasthan and Chattisgarh, there is a pall of gloom among all the right thinking citizens of India. They are visibly upset over the consequences of the reins of powers in these three important states going into the hands of those who plundered the scarce national resources – epitomized by a spate of scams during 2004-2014 [when UPA led by Congress was in command at the national level] – and pushed the country into a state of ‘policy paralysis’ and shattered the economy. That it would mend ways and deliver good governance in these states is wishful thinking....
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