To put a check on illegal mining and end 'mafiaraj' in the sector, the government on Thursday (24 September) came out with a draft policy which will use advance technologies like satellite surveillance to regulate mining of sand and other minor minerals.Environment Minister Prakash Javadekar said that the draft minor mineral sustainable mining policy notification has been issued and after taking in suggestions and public opinion, the new policy will be implemented from January 1 next year. The new policy will make use of combination of satellite surveillance, high-security receipts and decentralised decision-making to regulate mining of sand and other minor minerals along the nation's rivers. "A big problem in the country was illegal mining and 'mafiaraj' especially in the sand mining sector. We are going to make drastic changes in the system. "We have come out with a new mining policy. The draft notification of minor mineral sustainable mining policy has been published in the gazette," Javadekar told reporters while adding that sand, mud, marble, granite, stone and others fall under the category of minor minerals. The Union Minister said that Supreme Court had given a decision in February 2012 which said one had to take environment clearance for even mining on one hectare. He said that after taking over, his ministry looked at the best practises of the world, consulted the states, officials undertook visits and deliberations were done with experts. "We have made a policy which is scientific, sustainable, technology driven, user friendly, decentralised and has strong monitoring system. "This is a draft and will remain for 60 days. We will take in suggestions. After deliberations, on Janary 1, 2016, this policy will be implemented and a new era of sustainable mining will start in India," he said. "At places, there was so much illegal sand mining that many rivers had dried up in those areas while people and farmers were facing a lot of problems. "The policy will stop illegal mining, black marketing and help increase state's revenues. This was the mafia and for this officials and RTI activists were getting killed," he said. . Elaborating on the draft, the Minister said that District Survey Report of each district in the country will be prepared and each river will taken in as one ecological system. The use of satellite, ground truthing and sensors will be done to ascertain how much sand has accumulated at a particular place. Only that much material will be allowed to be mined out which is deposited annually. The Minister said that the District Level Environment Impact Assessment Authority (DEIAA) headed by the District collector to be assisted by District Level Expert Appraisal Committee (DEAC) have been assigned the responsibility of granting environmental clearance upto five hectare of mine lease area for minor minerals mainly sand. For area less than 50 hectares, it will be given by the state environment ministry while permission for mining in an area above 50 hectares will come to the Centre, he said. He said that stringent monitoring of movement of mined out material from source to destination using information technology tools like bar coding, SMS and others will be done. While till date, no authentic data of how much sand is being mined was available. The new policy will generate real time data on minded out sand while the transit permit have security features like unique bar code, QR code, fugitive ink background, invisible ink mark, watermark and others. Javadekar said that small miners cannot afford Environment Impact Assessment which is why under the new policy, cluster wise assessment will be done. Under the new draft policy, extraction of clay or sand by potters, earthen tile makers, removal of sand deposited on agricultural field by farmers, extraction for community work, dredging and desilting and others have been exempted. Blaming the previous UPA regime, Javadekar said that when he took over in 2014, he found that no new licenses had been issued, there was corruption and people were facing a lot of problems and the then government had wasted 27 months. "No new licenses were being issued. Those who did good work, their businesses got shut down and those who did it illegally, they flourished. There was heavy corruption. People had to face problems. Unfortunately the UPA government failed to follow up on it and create a new policy. They lost valuable 27 months," he said.(PTI)
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The government had earlier decision to exempt foreign portfolio investors from the levy of MATIn a big relief to foreign firms, government on Thursday (24 September) exempted them from paying Minimum Alternate Tax (MAT) retrospectively from April 2001, provided they did not have a permanent establishment in India. This, along with the government’s earlier decision to exempt foreign portfolio investors from the levy of MAT, is expected to completely put the MAT controversy to rest and assuage concerns of foreign investors. The provisions of Section 115JB of Income Tax will not apply to foreign companies with effect from April 1, 2001, if they are resident of a country with which India has Double Taxation Avoidance Agreement (DTAA) and they do not have a permanent establishment (PE) in India, said an official statement. In case the companies belong to countries with which India does not have a DTAA, the MAT exemption will apply if they are exempted from registration under Section 592 of the Companies Act 1956, or Section 380 of the Companies Act 2013. "An appropriate amendment to the Income-tax Act in this regard will be carried out," said the Finance Ministry statement. Earlier this month, the government had exempted foreign institutional and portfolio investors from payment of MAT on the capital gains made by them before April 1, 2015. The Budget 2015-16 had already exempted FIIs/FPIs from paying the levy on gains made after April 1. "Effectively, now all foreign companies have been exempted from MAT," said Rajesh Gandhi, a partner in Deloitte Haskins & Sells LLP. "It is a major relief as earlier there was no clarity whether foreign firms are liable to pay the tax." India first introduced MAT during the 1990s to ensure companies paid a minimum amount of tax, normally around 20 percent of profits. However, it had never been imposed on foreign investors until last year when tax officials, citing a court ruling, started sending notices to foreign funds, including Aberdeen Asset Management. The notices were challenged in courts. With foreign investors holding a quarter of the shares on the BSE Sensex, the controversy rattled local financial markets and forced Jaitley to set up a panel to resolve the dispute. Foreign investors have long been critical of India's tax bureaucracy, citing aggressive claims that have led to damaging rows with companies including Vodafone and, more recently, Cairn India. (Agencies)
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The Narendra Modi-led National Democratic Alliance (NDA) government's impatience with the Reserve Bank of India (RBI) over its failure to effect quicker and deeper lending rate cuts is understandable. At present, the bulk of the global economy is passing through turbulent times, and China, which has served as the world's growth engine, is slowing down, India's performance offers a welcome contrast. With oil prices once again plunging, the NDA government is of the view that the fiscal headroom provided by lower energy import costs and falling inflation offers a window of opportunity to further stimulate growth. Pitching for an interest rate cut to boost growth, Union Finance Minister Arun Jaitley has asserted that common sense says the interest rates should come down. RBI Governor Raghuram Rajan, who has so far resisted pressure from the government as well as the industry on easing monetary policy, is due to announce the next bi-monthly policy on September 29. Experts are of the view that the possibility of achieving a gross domestic product (GDP) growth of 8 per cent this fiscal, a rate cut could just be the icing on the cake for investors, both domestic and foreign. "If oil is selling at half the normal price, commodity prices are low, and we have stocks and stocks of food grain, then inflation is the least of our worries," Jaitley told Britain's The Financial Times. Growth, he said, was running at 7-7.5 per cent, a strong performance given adverse international conditions in which investors have scampered from emerging markets. Still, he said, if India's interest rates were lowered, the economy could grow still faster. With uncertainty getting over with regard to the US Fed rate, the central bank may yield to the pressure of easing rates. Quite a few columnists and media commentators read the Fed's decision to hold rates as clearing the ground for RBI to announce a rate cut. Given the current economic scenario, analysts are not ruling out the possibility of a 25 basis point repo rate cut by the central bank, particularly after a disappointing first quarter GDP data. Rajan has been under pressure to cut the rates further, with the government and industry leaders repeatedly stressing on the need to lower the cost of capital to give a boost to the economy, especially in the wake of retail inflation hitting record low levels and wholesale inflation actually being in the negative zone for 10 months in a row. Earlier this month at a meeting with Prime Minister Narendra Modi, industry captains renewed their call for another rate cut in the backdrop of a slowing economy and falling inflation. Industry association Assocham has said there was room for monetary easing to the tune of 75-125 basis points over the next seven months. The association pointed out that between January and July this year, the Wholesale Price Index (WPI) and Consumer Price Index (CPI) inflation fell 793 and 298 basis points, respectively, over the same period in 2014. Rajan's cautionary admonition, that achieving sustainable and inclusive growth is not possible merely through quick fixes like rate cuts and giveaways, takes a longer and more holistic view of the reforms debate. During the course of the CK Prahlad memorial lecture last week, the RBI boss counselled patience while cautioning policymakers against overemphasising the importance of rate cuts and other forms of stimuli. Citing Brazil's experience, Rajan said, "Brazil tried to grow too fast. The 7.6 per cent growth came on the back of substantial stimulus after the global financial crisis. In an attempt to keep growth high, the central bank was pressed to reduce interest rates, fuelling a credit spree that overburdened customers are now struggling to repay." Brazil, which was hailed as one of the most promising emerging markets not too long ago, has been downgraded to junk rating by international credit assessor Standard and Poor's. Rajan also cited India's own example. "Growth has to be obtained in the right way. It is possible to grow too fast with substantial stimulus, as we did in 2010 and 2011, only to pay the price in higher inflation, higher deficits and lower growth in 2013 and 2014," the governor said.Rajan also advocated the necessity of strong institutional structures, to support high growth. He also put the ball in the government's court, saying reforms (not rates) held the key to India's sustainable growth. Rajan said monetary policy can help strengthen the current economic recovery, but he added India will ultimately "expand sustainable growth potential only by continuing to implement reforms the government and regulators have announced. In a nutshell, the focus should be on improving the business environment as a way to drive growth rather than extending stimulus and rate cuts.
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Perhaps the Prime Minister, Narendra Modi can now feel less embarassed when he speaks with Sillicon Valley CEOs on 27 September, says Mala BhargavaThe Indian Government may be ruing its timing. Its National Encryption Policy was obviously too much, too abruptly, too problematically. In what may well be an example of the power of outrage, the draft policy that demanded people not delete their online communication including on the popular WhatsApp for at least 90 days, has caused the policy draft to be withdrawn for a rethink already. The government also wanted only encryption approved by it to be used by applications and companies that registered with it. Apparently in the name of national security, the government could then demand the text version of virtually any communication by anyone, whether it was SMS, email, WhatsApp or SnapChat or anything in between. After an outcry on social media, an addendum exempted, WhatsApp, Facebook and Twitter, specifically, and also commercial and bank transactions. The government itself was not bound by any of these restrictions. But in what must be the fastest turnaround on anything, the draft has been withdrawn for now. Perhaps the Prime Minister, Narendra Modi can now feel less embarassed when he speaks with Sillicon Valley CEOs on 27 September. The draft policy had proposed extensive control over various forms of online communication and outraged the general public. Abruptly and in stark clarity, the policy showed just what the government’s thinking is with regard to the common man’s freedom of thought, speech and privacy. Day by day, the right to live as one chooses is being eroded. From the ban on meat to the ban on certain websites, an increasing number of areas seem to be shifting under the purview of government control. And this is a frightening development. Last night, social media broke out into an uproar as netizens protested the proposed plan for the government to get right inside the encrypted communication of the common man, whether it was an online transaction or an exchange of terrible jokes between two people. The National Encryption Policy sought to control communication to such an extent that it calls for users of online technology and apps to keep their communication in text form for a period of 90 days in case the authorities should demand to see it for any reason. This was quite apart from the fact that the government wanted each application to register with it and hand over the keys to any encryption used. None of Your Business“#ModiDontReadMyWhatsApp” appeared on Twitter as a trending hashtag as vociferous protests grew louder. “I’m fervently hoping that the internet kills the government before the government kills the internet” tweeted Ramesh Srivats, humourist and commentator. A number of others compared today’s era to George Orwell’s book, 1984, andinterestingly, Modi supporters who are normally quick to get outright abusive and verbally violent, went quiet.
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By Mala Bhargava The draft of a new policy in which the Government of India has proposed extensive control over various forms of online communication has outraged the general public. Abruptly and in stark clarity, the policy seems to show just what the government's thinking is with regard to the common man's freedom of thought, speech and privacy. It's difficult to escape noticing that, day by day, the right to live as one chooses is being eroded. From the ban on meat to the ban on certain websites, an increasing number of areas seem to be shifting under the purview of government control. And this is a frightening development. On Monday night, social media broke out into an uproar as netizens protested the proposed plan for the government to get right inside the encrypted communication of the common man, whether it was an online transaction or an exchange of terrible jokes between two people. The National Encryption Policy seeks to control communication to such an extent that it calls for users of online technology and apps to keep their communication in text form for a period of 90 days in case the authorities should demand to see it for any reason. This was quite apart from the fact that the government wanted each application to register with it and hand over the keys to any encryption used. None of Your Business"#ModiDontReadMyWhatsApp" appeared on Twitter as a trending hashtag as vociferous protests grew louder. "I'm fervently hoping that the internet kills the government before the government kills the internet" tweeted Ramesh Srivats, humourist and commentator. A number of others compared today's era to George Orwell's book, 1984, and interestingly, Modi supporters who are normally quick to get outright abusive and verbally violent, went quiet. Backtracking A Few StepsSome hours later however, in an addendum, the government proposed exemptions to some categories of encryption products: 1) The mass use encryption products, which are currently being used in web applications, social media sites, and social media applications such as Whatsapp, Facebook, Twitter etc. 2) SSL/TLS encryption products being used in Internet-banking and payment gateways as directed by the Reserve Bank of India. 3) SSL/TLS encryption products being used for e-commerce and password based transactions." Unclear ClarificationsExperts are saying that the addendum clarifies little and warn that there's plenty of confusion up ahead. "I think it was a very half-baked plan," says Prasanto Roy, speaker and consultant on technology. "That's why they had to do a knee-jerk reaction mentioning some exemptions. It was a sweeping policy and now they mention WhatsApp, Facebook and Twitter and in doing so they tried to target specifically whatever was causing public outrage. I think they believe that if they remove Facebook and WhatsApp by and large the public will be happier. But the basic concerns remain. This policy is not aimed at making India safer, but controlling it." Roy described the policy draft as being outright bizarre, especially as it left out government departments and sensitive agencies out of the control oversight. A Field Day For HackersCyber lawyer Pavan Duggal thinks it is by no means time to relax. Facebook and social media apps are, in any case, public and there is plenty else that gives cause for alarm. "These clarifications are pretty vague," Duggal says. "Because what has been exempted is only Whatsapp, which isn't a social media application, and social media applications which is in any case public enough. What about other mobile applications? What about email? SMS? Though internet payments and banking are also exempted, there is plenty of confusion because the fundamental problem with the policy still remains. Specially the 90-day period in which the user is to retain messages in text form because retention without security leaves all communication vulnerable to hackers," he says. "It isn't going to help cyber security. It's a field day for hackers." Duggal hopes that the period that has been set aside for comments and reactions from experts and the general public will finally lead the government to incorporate something sensible and practical into the policy. He warns however that India still doesn't have a comprehensive law on cyber security. Under those conditions, it's only too easy for a government to impose its own rules.
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BW Online Bureau After a backlash, the government on Tuesday (September 22) clarified that it will keep WhatsApp, Twitter and Facebook out of the purview of a new draft encryption policy that seeks to control secured online communication. Secure banking transactions as well as password protected e-commerce businesses would also be kept out of the ambit of the proposed National Encryption Policy, it said. The government’s climbdown came following protests from users objecting to any stringent state controls on the way people use their emails, social media accounts and apps. Following the backlash, the government proposed an addendum to the draft document, saying: "By way of clarification, the following categories of encryption products are being exempted from the purview of the draft national encryption policy: The mass use encryption products, which are currently being used in web applications, social media sites, and social media applications such as Whatsapp, Facebook, Twitter etc. SSL/TLSencryption products being used in Internet-banking and payment gateways as directed by the Reserve Bank of India. And the SSL/TLS encryption products being used for e-commerce and password based transactions." According to the original draft policy, users of apps such as WhatsApp and Snapchat would be required to save all messages for up to 90 days and be able to produce them if asked by authorities. The draft policy was posted online to seek suggestions from the public before it is finalised by the government.
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Confident of meeting the "ambitious" disinvestment target of Rs 69,000 crore this fiscal, Finance Minister Arun Jaitley on Monday (21 September) said the government has moved fast so far and all routes are open on this front, including strategic sale of hotels. He also dismissed suggestions that it was LIC which was bailing out disinvestments and said the state-run insurer invests in public sector issues just like the public offers from the private sector. "We have an ambitious target for this year. Seven more months of this financial year are left," Jaitley told reporters here at a press conference on the last day of his four-day visit to Singapore and Hong Kong. "In the last two months, we have moved much faster, but markets have been in somewhat turmoil," he said in reply to queries on whether the market conditions would impact the disinvestment drive. "Do you hit the market when it is unpredictable or do you want it to stabilise? In fact the Indian Oil disinvestment took place on the day of the great fall after devaluation in China," Jaitley said. On queries about LIC being roped in to bail out the disinvestments, the Minister said, "LIC is the largest mover of the Indian stock market and therefore in any public issue also it will have an edge. "LIC is not a body which invests only to bail out the government in disinvestment. In the issues by private companies, LIC also participates. It stocks the shares as part of its investments and then sells them at an appropriate time," he said. On whether the government was open to strategic sales, Jaitley said, "I said in Budget that strategic disinvestment is also something that is on our agenda. The Department of Disinvestment is looking at some of the proposals particularly the hotels. "We are looking at hotels. All routes are open. We are also looking at what to do with the loss making entities." On a question about problems for ECB funding, Jaitley said, "If there are any issues, we will look at them through capital market reforms. That is a sectoral issue and I would not like to comment on that. But ECB is indeed an important source of funding for us. If there are any difficulties that arise, our capital markets division will look at those as when it comes." Asked what does he expect from RBI on rates, Jaitley said, "Let us leave it to RBI." On RBI powers being curtailed with the new Monetary Policy Committee, he said, "As of today RBI decides and once MPC is there that will decide. You don't know what the composition is going to be. All I can say is that it has made a considerable headway and the government and the RBI are on the same page." Asked about the perception that nothing has moved on the ground, Jaitley said he does not agree with those perceptions. "There is 49 per cent increase in FDI itself. Large projects in India are coming up..in the last two-three months, there have been significant improvement on large projects," he said.(PTI)
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In India, buying gold is a centuries old tradition, and even when jewellery is mostly seen as a store of value, rather than an adornment. Longer term success of the GBS and GMS depends a lot on how effectively the government can manage to change this thinking, writes Stephen Rego The government is moving fast to operationalise the Gold Bonds (GBS) and Gold Monetisation (GMS) Schemes that were approved by the Cabinet on September 9. Having announced the broad parameters under which they will function, now all that remains is for the RBI to fix interest rates and the ministry to issue appropriate notifications. Designed to reduce gold imports into the country, the twin schemes are the latest attempt to strike a balance between reining in the Current Account Deficit (CAD) and ensuring sufficient supply of the yellow metal to satisfy demand from the bullion trade and jewellery manufacturers. Stephen RegoGBS / GMS may have come not a moment too soon, for gold imports in August 2015 have shot up to US$ 4.95 billion as against US$ 2.06 billion a year ago, driven by a dramatic decline in prices and stocking in anticipation of the forthcoming festive season demand. While the basic premise of the GBS is to encourage those buying gold purely for investment purposes to switch to bonds, the GMS seeks to bring some portion of the estimated 20,000 tonnes of gold lying ‘idle’ with organisations and individuals across the country back into circulation. It allows banks to lend gold thus collected to jewellers under a Gold Metal Loan scheme. The deposited gold will also supplement RBI’s gold reserves. This will result in lower imports and reduce foreign exchange outflows. The government move has received an in-principle thumbs-up from the industry. The moot question is, will it deliver? A lot hinges on two critical aspects – attractiveness in terms of security, flexibilty and yield, and the procedures and paper work that will be required. The former will be critical in the case of the GBS, under which an investor can make purchases in denominations of 5, 10, 50 and 100 gms of gold and hold the bonds for a period of 5-7 years. The bonds will be redeemed in cash or can be traded on an exchange for early exit. The cap on individual purchases has been set at 500 gms per year. GBS is relatively well-designed on most parameters. The 5-7 year tenor guards against medium-term price volatility. Investors have also been given an option of one-time renewal should prices on maturity be lower than the original purchase price. Flexibility for an early exit will however depend on trading volumes. If interest rates are at ~2% as widely expected, the GBS may have some initial success, especially among urban and educated investors. An ICRA report estimates that it may result in a 5% drop in demand for physical gold over the next couple of years. The GMS is somewhat different. On the positive side, it seeks to iron out some of the more obvious flaws of the existing Gold Deposit Scheme, which has been in place for many years, but failed to make much of an impact. Thus the minimum deposit amount has been reduced to 30 gms from 500 gms earlier, widening the potential customer-base. There are also diffferent tenors which will have varying (though yet to be announced) interest rates and redemption options, which will appeal to different sections who wish to monetise their gold holdings. Also jewellery /ornaments have been excluded from the scheme, based on the valid assumption that households and individuals will be reluctant to part with what are mostly family heirlooms. The customer will now have a Gold Savings Account, instead of the certificate that was issued earlier. However, on the flip side, the person opening the Gold Savings Account has to complete KYC compliance, which many may be reluctant to do. This is not only true for those who have purchased gold with undeclared income, but also for those who hold gold that is legitimately inherited, but does not have any documentation. The same holds true for gold bought by rural households, even when it represents legally earned income from agriculture. These sections will be wary about entering the scheme. Inadequate infrastructure could also prove to be an impediment. All gold deposited under the GMS will be sent for assaying to determine its actual purity (unfortunately in India, undercaratage, or the practise of using gold of a lower purity than formally declared, is quite widespread) before the actual amount of deposit is finalised. Experts believe that the 300 or so assaying centres across the country will be insufficient to ensure speedy turnaround and the resulant delays and lack of transparency will impact consumer confidence. A more serious obstacle is of course cultural. In India, buying gold is a centuries old tradition, and even when jewellery is mostly seen as a store of value, rather than an adornment. Longer term success of the GBS and GMS depends a lot on how effectively the government can manage to change this thinking. Stephen Rego has been a journalist since the mid-1980s, and has spent close to two decades tracking the gem and jewellery industry while holding different editorial positions in industry specific publications and websites
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India announced new rules on Friday making it compulsory for sugar producers to ramp up exports to at least 4 million tonnes in the forthcoming crushing season, to cut stockpiles as the country is set to produce a surplus for a sixth straight year. India is the world's biggest sugar producer after Brazil and much higher exports would help clear huge sugarcane dues to farmers. But it would also add to a global glut and could further depress prices, which are languishing at seven-year lows. The new crushing season starts on Oct. 1. In the current season, India exported 1.3 million tonnes. Abinash Verma, director general of the Indian Sugar Mills Association (ISMA), said producers wouldn't be able to export a combined 4 million tonnes unless they receive more government help. For many producers in India, the world's biggest consumer of sugar, exports are not viable because global prices are lower than local prices, he said. Sugar prices in India are trading nearly a fifth higher than global prices due to a government decision to raise cane prices, to support farmers, which has pushed up production costs. The government approved a subsidy of 4,000 rupees ($60.86) per tonne for exports of raw sugar in the current marketing year ending on Sept. 30, but has not said whether it will continue the subsidy after September. Many mills could not produce raw sugar for exports this year because the decision on a subsidy had been delayed until February. Verma said the planned increase in exports will push up sugar prices in India, which jumped 2 percent after the announcement. India is likely to start the 2015/16 season with carry forward stocks of 10.2 million tonnes and is expected to produce 28 million tonnes of sugar against local demand of around 25.2 million tonnes, estimates ISMA. India's food secretary said last week the government was working on a multi-year plan to boost sugar exports, targeting markets in Africa, China and neighbouring countries, confirming a Reuters report last month. Sugar producers must report their exports to the government, which has the power to act if export rules are violated. The new export requirement will quickly bring down inventories, which have been rising, the Mumbai-based head of a global trading firm said, on condition of anonymity. "The government should also make it clear whether it is going to extend the subsidy for next season's exports. It will help mills in signing deals in advance," he said. (Reuters)
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Government on Thursday (17 September) favoured an increase in pension fund EPFO’s equity market investment to 15 per cent, from 5 per cent currently, saying it will help contain volatility in the domestic capital markets. “We are now saying Employees Provident Fund Organisation (EPFO) which always had the ability to put up to 15 per cent of its assets in equity markets but never did so, has to now do at least 5 per cent. And hopefully over a period of time they bring it up to 15 per cent,” Sinha said at the India Economic Convention here. He said pension funds investing in domestic equity markets would help lower volatility in equity markets and as that comes down the cost of capital on equity side for businesses would come down. “We are trying to ensure that we stabilise and smoothen out our equity market,” Sinha added. The EPFO, which started investing in equity markets last month, has been investing primarily in state and central government securities.Sinha said that the BJP-led NDA government is focusing on building productive capacity to sustain 8-10 per cent growth over a longer period of time. “We want to build in India’s productive capacity so that we can sustain 8-10 per cent non-inflationary GDP growth rate not just for few year, but to be able to achieve that 8-10 per cent growth steadily through boom and bust cycles,” he said. Indian’s GDP grew at 7 per cent in the first quarter of current fiscal and government expects it to grow 8-8.5 per cent this year. Sinha said the macro economic indicators — inflation, GDP growth, current account deficit and fiscal deficit — have improved considerably since May 2014, when the BJP government came into power. As regards cost of capital, Sinha said after factoring in the cost of hedging dollar against rupee, large companies are able to borrow at reasonable rates. “The financial markets in India work well for a certain group of players. And I think largely for large players in India, the markets are working relatively well. Risk is being priced appropriately,” Sinha added. He further said that bluechip companies in India borrow at around 5-5.5 per cent over a 30 year horizon in global markets, whereas in rupee terms the cost of borrowing would be 10-12 per cent. “If you look at large companies in India they are able to borrow at fairly reasonable rates once you factor in the cost of hedging dollar against rupee,” he said. As regards funding stressed infrastructure projects, Sinha said the National Investment and Infrastructure Fund (NIIF) would act as a special situation fund anchored by the government and could include other investors like pension funds.(PTI)
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