Huawei CFO's legal team to contest U.S. extradition in day 2 of Canada hearing
Huawei Chief Financial Officer Meng Wanzhou is set to return to a Vancouver court on Tuesday, where her lawyers will build on their arguments against the U.S. extradition request that they say is based a sanctions violation and not bank fraud.
Meng, 47, arrived in a Vancouver courtroom on Monday for the first phase of a hearing that will last at least four days, during which her legal team argued that “double criminality” was at the heart of the case, as China repeated its call for Canada to release her.
The United States has charged Meng with bank fraud, and accused her of misleading HSBC Holdings Plc about Huawei Technologies Co Ltd's business in Iran.
Court proceedings show the United States issued the arrest warrant, which Canada acted on in December 2018, because it believes Meng covered up attempts by Huawei-linked companies to sell equipment to Iran, breaking U.S. sanctions against the country.
Meng, the daughter of Huawei's billionaire founder Ren Zhengfei, remains free on bail in Canada, and has been living in a mansion in Vancouver's exclusive Shaughnessy neighbourhood.
She has said she is innocent and is fighting extradition in part because her alleged conduct was not illegal in Canada, an argument commonly called “double criminality.”
Unlike the United States, Canada did not have sanctions against Iran at the time Canadian officials authorized the start of the extradition process, her lawyers have said. Reuters
Seized assets of Nirav Modi to be auctioned at Saffronart’s two upcoming sales
Fugitive businessman Nirav Modi’s seized assets including artworks, luxury watches, handbags and cars will go under the hammer at Saffronart’s two upcoming auctions. The Mumbai-based auction house has been selected to host the sales on behalf of the Enforcement Directorate, Government of India. While the first sale, a live auction, will be held on February 27 in Mumbai, the second will be an online sale on March 3-4.
Highlights of the auction include 15 artworks by significant modern and contemporary Indian artists like a 1935 masterpiece by Amrita Sher-Gil which has never previously been auctioned and is estimated at Rs 12-18 crore, a significant oil on canvas by M F Husain from his “Mahabharata” series, also estimated at Rs 12-18 crore, a 1972 serene blue painting by V S Gaitonde estimated at Rs 7-9 crore, and a vivid red depiction of Krishna by Manjit Bawa, estimated at Rs 3-5 crores, among others.
Proposed cut in duty-free liquor, cigarettes to cause Rs 650cr/year loss to airports: industry body
Indian airports are likely to incur a revenue loss of Rs 650 crore per annum if the reported recommendations of the Commerce Ministry on duty-free sales are put in place, private airports operators body APAO said on Tuesday.
Vehemently opposing the proposed move to reduce liquor allowance from two litres to one litre and to do away with import of cigarettes presently one carton of 100 sticks, the Association of Private Airport Operators (APAO) in a statement said the move will have “disastrous” effect on the domestic aviation industry.
The Commerce Ministry, as part of its proposals to the finance ministry ahead of the budget, has recommended restricting purchase of tax-free alcohol to one bottle at duty-free shops as part of steps to reduce import of non-essential goods, sources had said earlier.
The ministry, as per the sources, has also recommended to the Finance Ministry that purchase of cigarette cartons at duty-free shops should be prohibited. PTI
Embassy Group forms new firm Olive to enter co-living biz
Realty firm Embassy Group on Tuesday announced an investment of up to Rs 1,000 crore to develop six greenfield co-living properties across major cities to meet the growing need of shared rental homes for students and co-living professionals.
Bengaluru-based Embassy Group, which last year launched India’s first real estate investment trust (REIT) and runs co-working business WeWork India, will operate co-living business under a separate firm ‘Olive by Embassy’
“We are launching a new firm and brand ‘Olive’ for our co-living business which is now emerging as a separate asset class. The objective is to disrupt the PG (accommodation) market which is unorganised and poorly managed,” Embassy group Chief Operating Officer Aditya Virwani said. PTI
ISRO provides consultation to Qualcomm on NavIC capability
The Indian Space Research Organisation on Tuesday said it has provided “consultation” to San Diego-based chipmaker Qualcomm towards enabling NavIC capability in their Snapdragon mobile chipset platforms.
The Indian Regional Navigation Satellite System (IRNSS), also called NavIC--Navigation with Indian Constellation--is reportedly on par with US-based GPS, Russia’s Glonass and Galileo developed by Europe.
“These chipsets are being released by Qualcomm Technologies, Inc., and the release will help accelerate the adoption of NavIC by smartphone OEMs,” ISRO said on its website. PTI
RBI cancels certificate of authorisation of Vodafone m-pesa
The Reserve Bank of India on Tuesday said it has cancelled the Certificate of Authorisation (CoA) of Vodafone m-pesa on account of voluntary surrender of authorisation.
Following the cancellation of the CoA, the company cannot transact the business of issuance and operation of prepaid payment instruments, the central bank said.
However, customers or merchants having a valid claim on the company as a PSO, can approach the company for settlement of their claims within three years from the date of cancellation i.e. by September 30, 2022.
Vodafone m-pesa, a Payment System Operator (PSO), had voluntarily surrendered the authorisation, it said.
Last year, Vodafone Idea had decided to close m-pesa vertical following the closure of Aditya Birla Idea Payments Bank Ltd (ABIPBL), with which it was being merged.
Vodafone m-pesa was one of the 11 firms that was given payments bank licence by the RBI in 2015. PTI
Prepare for attack by govt ministers on IMF, Gita Gopinath: Chidambaram on growth forecast
With the IMF lowering India’s economic growth estimate for the current fiscal to 4.8 per cent, senior Congress leader P Chidambaram on Tuesday claimed an attack on the world body and its chief economist Gita Gopinath by government ministers was imminent.
He also alleged that the growth figure of 4.8 per cent given by the International Monetary Fund (IMF) is after some “window dressing” and he won’t be surprised if it goes even lower.
“Reality check from IMF. Growth in 2019-20 will be below 5 per cent, at 4.8 per cent,” Chidambaram said in a series of tweets.
“Even the 4.8 per cent is after some window dressing. I will not be surprised if it goes even lower,” the former finance minister said.
IMF Chief Economist Gopinath was one of the first to denounce demonetisation, he noted.
“I suppose we must prepare ourselves for an attack by government ministers on the IMF and Dr Gita Gopinath,” Chidambaram said.
The IMF lowered India’s economic growth estimate for the current fiscal to 4.8 per cent and listed the country’s much lower-than-expected GDP numbers as the single biggest drag on its global growth forecast for two years.
In October, the IMF had pegged India economic growth at 6.1 per cent for 2019.
Listing decline in rural demand growth and an overall credit sluggishness for lowering of India forecasts, Gopinath, however, had said the growth momentum should improve next year due to factors like positive impact of corporate tax rate reduction. PTI
Hyderabad ranks 14th globally in housing price appreciation
Hyderabad ranked 14th out of 150 cities globally in terms of price appreciation in residential properties, with the southern Indian city witnessing 9 per cent increase in rates during July-September period last year, according to property consultant Knight Frank.
Budapest in Hungary leads the ‘Global Residential Cities Index Q3 2019’ with the highest annual growth rate of 24 per cent, followed by Xi’an and Wuhan in China at 15.9 per cent and 14.9 per cent, respectively.
Knight Frank said that Hyderabad is the only Indian city to figure in top 20 list in terms of appreciation in residential real estate prices.
Among other Indian cities, Delhi ranked 73th with 3.2 per cent growth in housing prices year-on-year, followed by Bengaluru at 94th position that saw 2 per cent rise in home rates.
Ahmedabad ranked 108th with 1.1 per cent rise in housing prices, while Kolkata stood at 130th position, recording 2 per cent decline in rates. Mumbai and Chennai ranked 135 and 136, respectively, with 3 per cent fall in housing prices in both the cities.
Chennai is at 138th position with 3.5 per cent decline in rates.
Price growth has been strong in the Hyderabad residential market as shortfall in launches diverted homebuyers towards the ready unsold units, giving developers a bargaining edge, Knight Frank said in the report. PTI
Yuan tumbles, yen rallies as spread of China virus unnerves markets
China's yuan tumbled on Tuesday, pulling away from six-month highs against the dollar, while the yen rallied as the spread of a pneumonia-like virus in China sparked a sudden bout of risk aversion and rattled world markets.
China reported a fourth death from a new coronavirus as the number of cases continued to rise, just as hundreds of millions of Chinese prepared to travel for the Lunar New Year holiday.
Global stocks fell as the outbreak rekindled memories of the Severe Acute Respiratory Syndrome (SARS) in 2002/2003, another coronavirus which broke out in China and killed nearly 800 people in a global pandemic.
“You've got a stronger yen, a stronger Swiss franc and risk aversion is setting in across everything,” said Kit Juckes, an analyst at Societe Generale.
“It would be very surprising if it was a trend-changer in terms of where things go from here, but it is early days.”
In currency markets, the yuan bore the brunt of the jitters, tumbling almost 0.7% in offshore trading to 6.9126 per dollar , off six-month highs hit just on Monday. Onshore, the yuan hit its lowest in over a week at 6.9094.
The moves rippled across Asia to currencies linked to Chinese trade and tourism, with the Australian dollar shedding 0.4% to $0.68445, its lowest in over a month.
The New Zealand dollar was down a third of a percent at $0.6590, while the Korean won dropped 0.8% .
In contrast, the yen firmed 0.2% to 109.97 per dollar as investors rushed for safe-haven assets such as the Japanese currency and U.S. Treasuries. Reuters
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Barclays raises 2020 oil demand forecast on expected global economic recovery
Barclays on Tuesday forecast 2020 oil demand to rise by 1.4 million barrels per day (bpd), up from growth of 900,000 bpd in 2019, and an increase of 50,000 bpd from its earlier forecast, on an expected recovery in global economic activity
The demand growth will be led by emerging market countries in Asia and Latin America. Much of this growth will come from India, where oil demand will increase by 250,000 bpd in 2020 from 2019, the bank said in a note. The bank also raised its growth estimates for the United States and China following the Phase 1 trade deal sign last week.
“Recent signing of the Phase 1 trade deal between the U.S. and China will likely boost investment confidence and will likely lead to increased activity growth,” the bank said adding material gains in trade volume will largely depend on the pace of tariff reductions, which remains uncertain.
The bank maintained its 2020 forecasts for Brent and West Texas Intermediate (WTI) prices at $62 per barrel and $57 per barrel, respectively.
The relative calm in oil markets hides the shifting underlying dynamics such as more aggressive output cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, or OPEC+, rising U.S. shale growth constraints and heightened geopolitical risks with U.S.-Iran tensions.
OPEC+ agreed to deepen output cuts for the first quarter of 2020 and will next meet on March to decide on further cuts. Reuters
Info Edge shares rise after Zomato-Uber Eats deal
Shares of Info Edge (India), one of the shareholders in Zomato, on Tuesday gained over 3 per cent after the online food ordering platform acquired the India business of Uber Eats in an all-stock deal.
Shares of Info Edge (India) rose 3.47 per cent to trade at Rs 2,676.10 per unit on the BSE.
On the NSE, the stock gained as much as 3.2 per cent to Rs 2,675.
Zomato on Tuesday said it has acquired the Indian business of Uber Eats in an all-stock deal that will give Uber 9.99 per cent stake in the Indian food delivery and restaurant discovery platform.
Uber Eats in India will discontinue operations and direct restaurants, delivery partners, and users of the Uber Eats apps to the Zomato platform, effective Tuesday, as per a company statement.
In a regulatory filing to BSE, Info Edge (India) - a shareholder in Zomato - said its shareholding in Zomato will stand reduced to about 22.71 per cent on fully converted and diluted basis upon closing of the transaction. PTI
India's new law to protect foreign investors to exclude tax demands
New legislation will improve protection for foreign investors in India by offering relief from possible policy changes but will uphold the state's right to tax them, according to its draft and government documents seen by Reuters.
The bill also attempts to upgrade India's investment climate and boost foreign investment by setting up new adjudicating authorities to swiftly resolve disputes. It is part of India's efforts to become a $5 trillion economy by 2024, from around $2.7 trillion currently, the documents said.
But the draft text of the new law dated Nov. 15 does not cover demands related to enforcement of tax obligations, a critical area of concern for foreign investors.
Several firms including IBM, Royal Dutch Shell and Vodafone have collectively faced billions of dollars in tax claims from India's government in recent years, leading to arbitration cases and protracted legal battles in courts.
A separate internal government document which analyses the draft law noted that taxation issues were of “great interest” to investors and excluding it from the law's purview could reduce the proposal's intent to boost their comfort level.
Nevertheless, the document defended the exclusion, saying ”the power to tax is an integral part of the state's police powers even recognised in international law”.
The Finance Ministry, which drafted the law, did not respond to a request for comment.
Two sources familiar with deliberations on the law said it could still undergo several changes before it is finalised. The bill is likely to be presented for passage in the upcoming parliament session that starts Jan. 31, they said.
The bill proposes to cover a wide range of foreign investors, including investments from sovereign wealth funds, pension funds and insurance funds, the government document said. Reuters
Vodafone, Bharti Airtel to be affected as SC rejects AGR review plea: Fitch Ratings
With the Supreme Court rejecting a review of its order that put Rs 1.47 lakh crore liability of past dues on telecom firms, the two incumbents -- Vodafone Idea and Bharti Airtel -- would be particulary affected, Fitch Ratings said on Tuesday.
The apex court’s ruling will also have significant repercussions for India’s banking sector as well as the countrys broader economic outlook, it added.
“The Indian Supreme Court’s rejection on 16 January of a review petition against its earlier ruling in a long-running telecommunications sector tax case, is credit negative for the industry. Two incumbents, Vodafone Idea Limited and Bharti Airtel Limited (BBB-/Rating Watch Negative), will be particularly affected,” Fitch Ratings said in a statement.
The Supreme Court last week dismissed review petitions filed by telecom companies against its October 24, 2019 order that asked for inclusion of non-telecom revenues for calculating statutory dues such as license fee and spectrum usage charge.
“The court’s rulings in this case could also have significant repercussions for India’s banking sector, as well as the country’s broader economic outlook,” the rating agency said.
The apex court’s decision to reject the review petition is likely to lead the Department of Telecommunications (DOT) to demand that telcos pay unpaid dues on licence fees and spectrum usage charges by January 23, Fitch Ratings said. PTI
China's Baoshang Bank to be taken over by local govts, state firms
China's troubled Baoshang Bank will be taken over by local governments and a group of state firms, a central bank official with direct knowledge of the matter said, as Beijing looks to shore up some of the country's weakest lenders.
Financial regulators took control of Inner Mongolia-based Baoshang Bank last May, citing serious credit risks. That takeover rattled domestic markets, pushing up interbank funding costs for some smaller lenders and prompting the central bank to inject cash into the banking system to prevent contagion risks.
The governments of China's Inner Mongolia Autonomous Region and Baotou, a major city in the region, will lead the acquisition of at least a 50% stake in a reorganised Baoshang Bank, according to the official, who declined to be identified given the sensitivity of the matter.
State firms in Inner Mongolia will also participate in the takeover, the official said. Reuters
Global body calls for urgent changes to international tax systems to tackle inequality
With financial inequality hitting the roof in India and several other countries, a global body of rights activists and academics has called for immediate steps to make a sustainable and more effective international corporate taxation system.
Referring to an Oxfam study released here on Monday, Independent Commission for the Reform of International Corporate Taxation (ICRICTC) said the inequality crisis remains unaddressed and out of control as hundreds of millions of people are living in extreme poverty while large rewards go to those at the very top.
In 2019, the world’s billionaires - only 2,153 people - had more wealth than the poorest 4.6 billion people combined, Oxfam has said.
A new generation of inequalities is opening up, around education, technology and climate change. The demonstrations that swept across the world last year signal a global revolt against extreme inequality and the poor living standards for a large amount of the world’s population, the ICRICTC noted.
The body said it aims to promote the international corporate tax reform debate through a wider and more inclusive discussion of international tax rules than is possible through any other existing forum and to consider reforms from a perspective of public interest rather than national advantage.
Faced with popular demands, governments excuse themselves by arguing that their coffers are empty and implementing austerity program. These measures only aggravate economic, social, gender and racial disparities, depriving people of access to health care, education, or housing, especially in developing countries, it added. PTI
Telcos seek fresh schedule for payment of ₹1.47 lakh cr statutory dues
The Supreme Court on Tuesday agreed to list next week the fresh pleas of telecom firms, including Bharti Airtel, Vodafone Idea and Tata Teleservices, seeking a fresh schedule of payment of statutory dues to the tune of Rs 1.47 lakh crore to the Department of Telecommunications.
A bench headed by Chief Justice S A Bobde took note of submissions by a battery of senior lawyers including A M Singhvi and C A Sundaram, and said it will list the fresh pleas “sometime in next week” before the same bench which had heard the earlier petition in the high-stake matter.
“We are not disputing the payment to be made by us rather we want working out of fresh schedule of payment,” Sundaram told the bench which also comprised justices S A Nazeer and Sanjiv Khanna.
The telcos said they wanted an open court hearing on their fresh pleas with regard to working out fresh schedule of payment of their dues. PTI
Air France-KLM proposes buying 49% of Malaysia Airlines
Proposals to invest in ailing Malaysia Airlines include one from Air France-KLM, which wants as much as 49%, while Japan Airlines is looking at a 25% stake, sources with knowledge of the matter said.
Domestic carrier AirAsia Group Bhd and Malindo Air, the Malaysian arm of Indonesia's Lion Air, have also submitted proposals, the sources said.
“The bids from the foreign carriers are more comprehensive and strategic as both plan to capitalise on the strategic location of Malaysia for their operations,” said one of the sources.
The Malaysian government has been seeking a strategic partner for its national airline, which has struggled to recover from two tragedies - the mysterious disappearance of flight MH370 and the shooting down of flight MH17 over eastern Ukraine. Reuters
Pessimism on revenue growth at record level among CEOs: PwC survey
A record level of pessimism has creeped into the CEOs across the world regarding the worldwide economic growth, a survey showed on the first evening of the WEF annual meeting.
For the first time, more than half of the CEOs surveyed by global consultancy PwC said they believe the rate of global GDP growth will decline.
In comparison, the survey had found a record level of optimism among CEOs two years ago in 2018.
In the latest survey, only 27% of CEOs said they are ‘very confident’ in their prospects for revenue growth in 2020, a low level not seen since 2009. PTI
Rupee dips 6 paise against US dollar in early trade
The rupee depreciated by 6 paise to 71.17 against the US dollar in opening trade on Tuesday, tracking weak domestic equity market.
However, a weak dollar against other major currencies overseas and softening crude prices restricted the rupee’s fall, dealers said.
At the interbank foreign exchange market, the local currency opened on a weak note at 71.17 and fell further to hit a low of 71.19 against the US dollar.
The domestic unit had settled at 71.11 against the American currency on Monday. PTI
Sensex drops over 200 pts; Nifty tests 12,200
Market benchmark Sensex dropped over 200 points on Tuesday led by losses in index-heavyweights HDFC twins, Kotak Bank and ITC amid weak global cues.
After hitting an intra-day low of 41,301.63, the 30-share BSE index pared losses to trade 86.90 points or 0.21 per cent lower at 41,442.01.
Similarly, the broader NSE was trading 18.90 points, or 0.15 per cent, lower at 12,205.65.
Kotak Bank was the top laggard in the Sensex pack, shedding up to 1.25 per cent, followed by Tata Steel, Hero MotoCorp, HDFC duo, PowerGrid and Titan.
On the other hand, Reliance Industries, IndusInd Bank, NTPC, SBI, ICICI Bank, ONGC and HCL Tech were trading on a positive note. PTI
