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Time for sovereign bonds is right now: Garg

A confidant India needs to raise Sovereign Bonds in Foreign Currency. Advanced economies are awash with savings, whereas developing countries like India are still hugely short of savings to fund investment.

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New Delhi, Nov 7 : Former Finance secretary Subhash Chandra Garg has asserted that India needs sovereign bonds in foreign currency while time for sovereign bonds is right now and there is no medicine for irrational fear.

The Centre should raise approximately 10% of her annual borrowing in the form of sovereign bonds (foreign currency denominated listed in foreign exchanges) to build upon portfolio of approximately 100 billion dollars. Thereafter, sovereign bonds offering for retirement of maturing bonds and new borrowings should be managed in such a manner that aggregated sovereign bonds outstanding does not exceed 5% of GDP, Garg said in his report on measures which need to be taken to build $10 trillion economy by early 2030.

He said the government’s investments in financial sector behemoths like LIC and SBI are neither yielding any proportionate returns to the government nor are being used productively for deepening and expanding financial sector in India.

Likewise, foreign exchange reserves maintained by the RBI yield very low returns and now at much higher levels than required for any liquidity purpose. Additionally, by keeping these invested in treasury and other financial sector institutions abroad, their use for acquisition of strategic, technological and financial sector assets abroad is being foregone. Two sovereign wealth funds are recommended to be created for contributing to the goal of $10 trillion economy , he added.

Garg is said to have miffed a section of BJP leaders and a number of financial experts such as former RBI Governor Raghuram Rajan over his insistence on the foreign currency sovereign bonds which he also made part of the Budget. He, as per several quarters, got shifted out of Finance Ministry due to this decision.

A confidant India needs to raise Sovereign Bonds in Foreign Currency. Advanced economies are awash with savings, whereas developing countries like India are still hugely short of savings to fund investment, the ex-secretary said.

“Raising sovereign debt in foreign currency is the real opportunity to raise resources at cheaper cost to meet the investment gap. Several path breaking decisions have been opened in the past for integrating with the global economy. Time for sovereign bonds is right now. There is no medicine for irrational fear. It has to be simply set aside”, he said.

All macro-economic indicators suggest that investment demand has been declining in the advanced economies, whereas there is enormous unsatisfied investment demand in the emerging market countries.

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CAI raises cotton export estimates on weak domestic currency

The CAI has also reduced the production estimates of cotton from 354.50 to 330 lakh bales.

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Juit Cotton Industry

New Delhi, May 26 : The Cotton Association of India (CAI) has increased its estimates of cotton export from 42 lakh bales to 47 lakh bales in the current cotton season 2019-20 (October-September) as weakness in the domestic currency may boost export demand.

Target of Indian cotton exports is increased by 5 lakh bales from 42 lakh bales to 47 lakh bales looking favourable conditions for exports as Indian rupee is depreciated by 8-10 per cent which is lending a big support, said the CAI in a statement on Monday.

The Indian cotton is the cheapest in the world at this time, said the industry body which reduced India’s cotton import estimates by 10 lakh bales from 25 lakh bales to 15 lakh bales due to depreciation in rupee.

The CAI has also reduced the production estimates of cotton from 354.50 to 330 lakh bales.

Mentioning the reasons for lower estimates of cotton production, the industry body said, ‘due to the availability of water, many farmers didn’t not wait for the last picking of cotton and uprooted cotton plants and gone for rabi crop.

Apart from that, ginning factories were completely closed from March 25 to April 30 amid a nationwide lockdown, still they are running with merely 20-30 per cent of their capacities.

Labour shortage in ginning factories due to the lockdown is also a reason for reducing production estimates of cotton, said the industry body.

According to CAI, the domestic consumption of cotton is also estimated 280 lakh bales, down by 51 lakh bales from previous estimates of 331 lakh bales as mills were closed due to lockdown.

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Modi govt insincere towards people, eco package a rude shock: Kharge

He also said that the government lost a big opportunity to provide relief to the crores of migrant workers and the poor on one hand, and the industries on the other.

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Kharge

New Delhi, May 25 : The Congress on Monday hit out at the Narendra Modi-led government over its promise of Rs 20 lakh crore economic package, accusing it of being insincere towards the people, saying the package came as a rude shock for anyone who was expecting some respite.

In a statement, Congress General Secretary Mallikarjun Kharge said that it has been 60 days since the lockdown was imposed and every sector of the Indian economy was facing a grave crisis.

“We needed a sector-wise plan and the government had 60 days of lockdown to plan for this. Sectors like tourism, hospitality, airlines, transport, retail, restaurants and construction needed very specific measures, given that they employ large numbers of people. But, it is clear from the measures announced last week that the government has either no sense of the crisis, or has plainly refused to address it to revive the economy,” he said.

Slamming the Centre, Kharge said that India’s GDP growth has been declining for the last six years, and the crisis was brewing even before the coronavirus pandemic.

“Sudden shock of the lockdown has pushed the economy from a slowdown to a complete shutdown. The government needed to revive the economy by reviving supply, demand and credit cycle with its financial package. Instead, the economic package doesn’t just prove that the government is insincere, but has failed on all fronts,” he said.

Lamenting at the government over the economic package announced by Prime Minister Narendra Modi in his special address to nation earlier this month, Kharge said that announcements by the Prime Minister of the country should be made with a lot of deliberation and seriousness, especially during such an unprecedented crisis.

“The so called Rs 20 lakh crore economic package has now been analysed by the experts, and its total cost works out to less than one per cent of the GDP. It has come as a rude shock for anyone who was expecting some respite,” the Congress leader said.

Kharge said that the Prime Minister only “intends” to make grand headline news without taking his colleagues into confidence.

“That is perhaps why Finance Ministry was unprepared and put together such a shoddy package,” he said, adding that on May 5, the Chief Economic Advisor had specifically warned against a stimulus measure as large as Rs 20 lakh crore or 10 per cent of the GDP, saying India cannot afford it.

Kharge said that probably he was not aware that the Prime Minister was going to announce a Rs 20 lakh crore package a week later.

“In any case, it turned out that the package is worth less than one per cent of the GDP, but it shows how the government functions,” he said.

Taking a dig at the government, he further said that the economic package had no “immediate relief” for the agriculture sector, except for talking about reforms.

Today, the agriculture sector is the only bright spot which is expected to grow at 3 per cent when the GDP for the second quarter is expected to fall drastically, he said.

He further said that even top industrialists have asked direct cash transfer of Rs 5,000 to Rs 7,500 per month to the poor to boost demand.

“This would also ensure economic freedom for the poor and prevent at least 20 crore people from falling back into poverty. The government simply does not want to provide any direct relief to the poor, because it would mean endorsing the NYAY scheme that Rahul Gandhi had proposed,” Kharge said.

He also said that the government lost a big opportunity to provide relief to the crores of migrant workers and the poor on one hand, and the industries on the other.

“The relief package and the press conferences have not only exposed the apathy of the government towards the migrant workers, but also its arrogance and hypocrisy,” Kharge added.

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Zomato’s food delivery CEO Mohit Gupta made co-founder

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New Delhi, May 25 (IANS) Foodtech unicorn Zomato has promoted its CEO for Food Delivery, Mohit Gupta, to the position of Co-Founder. The announcement was made by Zomato CEO Deepinder Goyal in an internal email to employees.

New Delhi, May 25 (IANS) Foodtech unicorn Zomato has promoted its CEO for Food Delivery, Mohit Gupta, to the position of Co-Founder. The announcement was made by Zomato CEO Deepinder Goyal in an internal email to employees.

“While the foundation of Zomato was built before MG joined us, he has been instrumental in significantly strengthening it over the last two years. What he and his team has built is a very large part of our business, and our DNA today,” Goyal wrote in the email on Sunday, a copy of which has been seen by IANS.

“I’m happy to share that starting today, we are going to call MG a Founder at Zomato,” he said.

Zomato, which will mark 12 years in the industry this year, now has two other co-founders besides Goyal and Gupta — Gunjan Patidar and Guarav Gupta.

Zomato announced a Founders Program a year ago. The proramme was designed to recognise people who have contributed to Zomato deeply; have built/scaled businesses, and have consistently demonstrated a founder’s mindset for a reasonable period of time; and are acknowledged for their passion, commitment and perseverance.

“When I introduced the Founders Program a little over a year ago, I outlined a few qualities that all founders must exhibit. These qualities include trustworthiness, commitment and resilience among other things. MG checks all these boxes and more,” Goyal said.

Guarav Gupta was also made a founder of the company last year under this programme.

Due to the impact of the Covid-19 pandemic, Zomato recently announced the decision to lay off nearly 13 per cent of its workforce — over 600 employees.

“While we continue to build a more focused Zomato, we do not foresee having enough work for all our employees. We owe all our colleagues a challenging work environment, but we won’t be able to offer that to 13 per cent of our workforce going forward,” Goyal said in a statement this month.

“While the foundation of Zomato was built before MG joined us, he has been instrumental in significantly strengthening it over the last two years. What he and his team has built is a very large part of our business, and our DNA today,” Goyal wrote in the email on Sunday, a copy of which has been seen by IANS.

“I’m happy to share that starting today, we are going to call MG a Founder at Zomato,” he said.

Zomato, which will mark 12 years in the industry this year, now has two other co-founders besides Goyal and Gupta — Gunjan Patidar and Guarav Gupta.

Zomato announced a Founders Program a year ago. The proramme was designed to recognise people who have contributed to Zomato deeply; have built/scaled businesses, and have consistently demonstrated a founder’s mindset for a reasonable period of time; and are acknowledged for their passion, commitment and perseverance.

“When I introduced the Founders Program a little over a year ago, I outlined a few qualities that all founders must exhibit. These qualities include trustworthiness, commitment and resilience among other things. MG checks all these boxes and more,” Goyal said.

Guarav Gupta was also made a founder of the company last year under this programme.

Due to the impact of the Covid-19 pandemic, Zomato recently announced the decision to lay off nearly 13 per cent of its workforce — over 600 employees.

“While we continue to build a more focused Zomato, we do not foresee having enough work for all our employees. We owe all our colleagues a challenging work environment, but we won’t be able to offer that to 13 per cent of our workforce going forward,” Goyal said in a statement this month.

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