ED grills Chidambaram for 6 hrs in Air India deal case

Jan 21: Indian policymakers may make it easier for companies to tap foreign funding, as a prolonged cash squeeze makes it tough for firms to borrow at home.

Investors are speculating about potential steps Finance Minister Nirmala Sitharaman could unveil when she presents the nation’s budget on Feb. 1. These measures may include freeing up firms to borrow at higher rates and offering tax breaks to global funds.

“The government will need to relax local rules to make it easier for Indian companies to raise debt overseas and tide over the funding crunch in the onshore market,” said Raj Kothari, London-based head of trading at Jay Capital Ltd. “At the same time, they need to ensure that the borrowers tapping offshore markets abide with stricter corporate governance so as to avoid further defaults.”

A prolonged crisis in India’s shadow bank sector and a pile of bad loans at traditional lenders is making it expensive for Indian companies, other than the best-rated firms, to access funding. The government has tried a series of measures to spur domestic credit, including providing so-called credit enhancement and allowing tiny firms to restructure debt.

Here are some steps Sitharaman may consider to spur foreign borrowing:

• She could raise the cap of 450 basis points above Libor, which limits overall foreign debt costs for Indian companies

• This could help lower-rated firms sell bonds abroad. Indian companies rated BBB currently borrow at more than 10%, about 3.8 percentage points more than their top-rated peers;

• Sitharaman could waive the withholding tax foreign investors need to pay on holdings of rupee-denominated debt sold by Indian companies abroad

• The waiver was offered between September 2018 to March 2019, but wasn’t extended as the highest global interest rates since the financial crisis deterred Indian borrowers. Since then, the three-month Libor has dropped by about 1 percentage point

• She could permit Indian property developers and housing finance lenders to sell overseas bonds for reasons beyond affordable housing projects

• New funding lines to the real estate sector, arguably ground zero of India’s economic slowdown, could help kickstart consumption and investment as the industry is the nation’s biggest job-creator.

New Delhi, Jul 19: Amid the political firestorm in Rajasthan following Sachin Pilot's rebellion, senior Congress leader Kapil Sibal on Sunday called for amending the anti-defection law to ban all defectors from holding public office for five years and fighting the next election.

Sibal also said that the "antibodies" against the "virus of corrupt means" to topple elected governments lie in amending the Tenth Schedule of the Constitution (anti-defection law).

His attack comes in the wake of Pilot's open rebellion against the Ashok Gehlot government, which has been on shaky ground since, with at least 18 legislators backing the rebel leader.

Pilot was sacked as deputy chief minister and the state Congress chief earlier this week.

The Congress has accused the BJP of making efforts to topple the Gehlot government by indulging in horse-trading.

"Need for Vaccine: Virus of 'corrupt means' to topple elected governments has spread through a 'Wuhan like facility' in Delhi," Sibal tweeted, in an apparent swipe at the BJP.

"Its 'antibodies' lie in amending the Tenth Schedule. Ban all defectors from: Holding public office for five years, fighting the next election," he said.

Taking a swipe at Pilot over his claim that he is not joining the BJP, Sibal on Thursday had asked what happens to his "ghar wapsi" and whether Rajasthan's dissident legislators are vacationing in Haryana under the "watchful eye" of the saffron party.

In the house of 200, the Congress has 107 MLAs, including the 19 dissidents who have been issued notices of disqualification by the speaker and they have challenged them in the high court.

The Congress has maintained the claim that the Gehlot government has the support of 109 MLAs, including the two BTP MLAs.

New Delhi, Jun 16: Congress president Sonia Gandhi on Tuesday demanded a rollback of hike in fuel prices, saying the government's decision to increase the prices of petrol and diesel during the coronavirus crisis is "wholly insensitive" and "ill-advised".

The government is doing nothing short of "profiteering off its people" when they are down and out, she said in a letter to Prime Minister Narendra Modi.

Petrol and diesel prices were hiked for the 10th day in a row on Tuesday.

"I am deeply distressed that in these exceedingly difficult times since the beginning of March, the government has taken the wholly insensitive decision to increase petrol and diesel prices on no less than ten separate occasions," Gandhi said in her letter.

She accused the government of earning an additional revenue of nearly Rs 2.6 lakh crore through these "ill-advised" hikes in excise duty and increase in prices of petrol and diesel.

"I urge you to roll back these increases and pass on the benefit of low oil prices directly to the citizens of this country.

"If you wish for them to be 'self-reliant' then do not place financial fetters on their ability to move forward," the Congress president said.

Gandhi also urged the government to use its resources to put money directly into the hands of those in need in these times of severe hardship.