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Global FDI flow fell 13% in 2018: UN Report

According to the report, this is the the third consecutive annual decline in global FDI flow.

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Global FDI flows

New Delhi, June 12 (IANS) Global foreign direct investment (FDI) flows declined by 13 per cent in 2018 to $1.3 trillion from $1.5 trillion in 2017, the UNCTAD’s World Investment Report 2019 said on Wednesday.

According to the report, this is the the third consecutive annual decline in global FDI flow.

“The contraction was largely precipitated by the United States multinational enterprises (MNEs) repatriating earnings from abroad, making use of tax reforms introduced by the country in 2017, designed for that purpose,” it said.

The developed countries were the hardest hit by the earnings repatriation, where flows fell by a quarter to $557 billion, a level last seen in 2004.

“FDI continues to be trapped, confined to post-crisis lows. This does not bode well for the international community’s promise to tackle urgent global challenges, such as abject poverty and the climate crisis,” UNCTAD Secretary-General Mukhisa Kituyi said.

“Geopolitics and trade tensions risk continuing to weigh on FDI in 2019 and beyond,” he cautioned.

The tax-driven fall in FDI, which occurred in the first two quarters, was cushioned by increased transaction activity in the second half of 2018, the report said, adding that the value of cross-border merger and acquisitions rose by 18 per cent, fuelled by American multinational enterprises using liquidity in their foreign affiliates.

However, developing country flows managed to hold steady, rising by 2 per cent, which helped push flows to the developing world to more than half (54 per cent) of global flows, from 46 per cent in 2017 and just over a third before the financial crisis, it said.

The UNCTAD report noted that despite the FDI decline, the United States remained the largest recipient of FDI, followed by China, Hong Kong and Singapore.

In terms of outward investors, Japan became the largest followed by China and France, it said.

On the outlook for 2019, it said that FDI is expected to recover in developed economies as the effect of the US tax reforms winds down.

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Government must get out of business: Amit Khanna

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Amit Khanna

New Delhi, Dec 13 : What is striking about Amit Khanna is not just the fact that he has been part of the entire media spectrum — television, films, radio, print, studio head, besides being part of policy making, but that he refuses to wear any stars on the shoulders.

“For me, it has always been important to explore newer challenges,” smiles the lyricist, producer, filmmaker, poet and former Chairman of Reliance Entertainment.

As his second book “Words Sounds Images: A History of Media and Entertainment in India”, an encyclopedic study of the history of Indian media and entertainment, published by HarperCollins gets released today, he tells IANS: “We’re aware that India has an ancient tradition of music and dance, theatre; later print, radio and television, and now digital — so the book covers everything.”

Khanna, who has been consistently writing on the Indian media and entertainment scenario for decades now, says the idea of writing this book emerged after he started interacting with students and young professionals. “I realised there was no one book which could be accessed to give an overview of Indian media and entertainment.”

A keen observer of culture, society and contemporary trends, the media veteran who also mentors several youngsters now plans to travel and spend time teaching. “It is always interesting to interact with young professionals.”

For someone who has donned multiple hats in the media segment and has done several things simultaneously, it is giving inputs to policy that is on top of his priority list now. “Somebody has to engage with and deal with what is going to happen in various media in the years to come, and how others respond to it — whether it is the government or other stake holders. For me, exploring new frontiers is always interesting.

“Today, we exist in a networked society. It’s the first time in human history that four to five billion people are connected. This is an interesting age to be in and at this stage of my career, I want to observe, analyze, various media in terms of social and cultural change, and how do we use future as a friend. Yes, it is therefore a very fulfilling kind of engagement,” he adds.

Khanna, who has always stressed that government should focus just on making broader policies but stay completely away from businesses, insists that it holds true not just for media and entertainment but other industries too.

“All successive governments have said that government has no business to be in business, but it is very difficult for them to give up control. Of course, now things are less restrictive than they were 30 years ago. Unfortunately, in a democracy, where electoral politics is a major policy motivator, most politicians tend to be populist rather than commonsensical, something the country needs desperately.”

No conversation with a media expert can be complete without mentioning OTT. He says, “Let’s not forget it’s merely a platform. There are a few points in this value chain. It’s the creator and access. How does the consumer access that content? So, platform, after a point becomes irrelevant. You have to be platform agnostic. How does it matter where I am accessing the content I want to see or listen to, from? I really shouldn’t care if it coming to me through the sky, broadcast TV, direct to home, broadband or mobile Internet, right?

“We are in the phase where we are still concerned with platforms. I thought, over a passage of time, we would get under regulated, but sadly, we are getting over regulated. It’s a global phenomenon though in India, it’s more accentuated.”

Talk to him about the fact how many news outlets are recording an all-time low profit and shutting shop, and he asserts, “It’s do with the number of them. This country has more than 800 news channels. Things are way too fragmented. Let us also not forget that in India, the per capita spend on entertainment is the lowest among all large emerging economies.

“If you’re spending an hour on the phone now, that much time has been reduced from the activities you were participating in before, right? These channels will have to shut down. Some local channels and specialized digital platforms, which are a democratic medium and cost much less in terms of investment, will see a rise. Of course, one also needs to see what is their business model for sustenance and growth?”

Khanna, who set up PLUS Channel in 1989, India’s first integrated media and entertainment company that produced three hours of programming everyday for Doordarshan feels it is high time that the state broadcaster gets it act together.

“I was the Executive Producer of ‘Buniyad’ and producer for ‘Swaabhimaan’. Now, when you look at Doordarshan, it’s apparent that the standards and practices of state broadcasting in India are way behind. It is important for the government to realise the peculiar role of a public broadcaster in a pluralistic country like India, which boasts of several languages and cultures.

“Yes, we do need a public broadcaster, but it does not have to do what every private broadcaster is doing. I mean why should every cricket match should be shown on Doordarshan? That’s a stupid regulation. They just need to stick to good quality commissioned programming.

“Professionals need to be brought in immediately and given a free hand. Failing this, it will go the same road as BSNL, MTNL and Air India.”

Insisting that it paramount to invest on manpower training and development in media and other sectors, the media veteran, who has been on the governing council of FTII (Film and Television Institute of India), Pune and SRFTI (Satyajit Ray Film and Television Institute), Kolkata besides the board of MCRC (Mass Communication Research Centre), Jamia Millia Islamia, points, “When I was on their boards, I would constantly tell them to update their teaching methods which were decades old. We have to have excellent facility. Inviting guest faculty is a good short-term solution, but the need of the hour is to get trainers from abroad to teach the instructors and teachers on the latest breakthroughs in their subjects.”

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Sensex jumps 300 pts, Nifty tops 12k in early trade

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Sensex equity Nifty

Mumbai: Sensex advanced over 300 points during the early trade on Friday while the Nifty surpassed the 12,000 mark.

Investors were upbeat owing to the Fed’s dovish stance on future rate trajectory and strengthening rupee.

At 10.11 a.m., the Sensex was up 297.16 points to trade at 40,878.87. It opened at 40,754.82 from its previous close of 40,581.71. The Nifty was up 78.45 points to trade at 12,050.25.

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BPCL privatisation roadshows to begin overseas from Friday

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Bharat Petroleum Disinvestment

New Delhi, Dec 12 : The privatisation process of state-run BPCL will start this week with roadshows for its strategic stake sale scheduled from Friday in London, the US and Dubai led by DIPAM and oil ministry officials.

The officials will meet the prospective investors and will try to sell BPCL as an entity, which will give them an entry into the lucrative oil refinery as well as retail fuel market in India which are touted to be highly remunerative.

The investors’ feedback and concerns will be used to prepare the expression of interest for BPCL sale, said sources.

Though it still not has been made public, government sources say the world’s largest oil company, Aramco, may make up its mind to participate in the disinvestment of BPCL where government intends to sell its entire 53.29 per cent stake to a strategic investor now that its listing is over. Saudi Aramco tops with $2 trillion in valuation after the listing.

Finance Minister Nirmala Sitharaman has indicated that BPCL disinvestment may be completed in the current financial year.

Any company eyeing BPCL will have to pump in close to Rs 1 lakh crore (about Rs 60,000 crore for the government’s stake and the balance for open offer), said market sources.

The government’s stake is worth over Rs 60,000 crore at prevailing price of BPCL shares on the BSE. If the buyer has to further acquire a 25 per cent share in an open offer as per the takeover code, the total amount will rise close to Rs 1 lakh crore which will be very high for any investor.

On its part, the Department of Investment and Public Asset Management (DIPAM) is working out a plan to offload the entire government equity to a strategic partner, possibly a large overseas oil entity like Saudi Aramco, Total, ExxonMobil or Shell.

However, with oil market globally facing a slowdown with demand not picking up despite supply squeeze, the appetite for a large acquisition becomes difficult.

BPCL operates four refineries at Mumbai, Kochi, Bina in Madhya Pradesh and Numaligarh in Assam with a combined capacity to convert 38.3 million tonnes of crude oil into fuel.

It has 15,078 petrol pumps and 6,004 LPG distributors across the country. The government proposes to raise Rs 1.05 lakh crore from disinvestment in the current financial year. It had exceeded asset-sale targets of Rs 1 lakh crore in FY18 and Rs 80,000 crore in FY19.

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