New law for celebs endorsing unverified products soon
The Centre is working on a new legislation to replace the existing Consumer Protection Act, which will have penal provisions of Rs 50 lakh and five year imprisonment for celebrities promoting sale of items without verifying the quality, Union Minister Ramvilas Paswan said today. The proposed Consumer Protection Bill, 2016 has already been approved by the Parliamentary Standing Committee and would be introduced in Parliament in the next session, the Food and Consumer Affairs Minister told reporters here. The new legislation to replace the existing Consumer Protection Act, 1986 would have stringent provisions against actors and other personalities doing advertisements for brands without verifying the products. “Some leading actors/actresses like Amitabh Bachchan, Salman Khan and others claim that the products they promote will add to one’s strength or one will have hair on a bald head, which is not true. Such things should stop. You advertise for an item only after being convinced of its results yourself,” Paswan said. In the new legislation, penalty for indulging in a “deceiving” advertisement would be enhanced to Rs 50 lakh from Rs ten lakh at present and the jail term to five years from the current two years, he said. Paswan said the new legislation would have elaborate scope for a consumer to lodge complaint against a sub-standard product sitting at home and it would also enhance the monetary limits of district and state-level consumer redressal courts. “The new legislation will make it mandatory that the complaint be registered within 21 days,” he said adding, it would enhance the limit of a district court to hear complaints of up to Rs one crore from the present Rs 20 lakh and state courts to Rs 14 crore from present Rs one crore. Paswan also expressed worry over cheap Chinese goods flooding the market and said measures would be taken to check their rampant flow in the country. “Chinese entrepreneurs make a low-priced Lord Ganesha and Parvati for Diwali. Was Lord Ganesha born in China?” he asked. He also mentioned growing instances of irregularities in sale of gold and said BIS would be strengthened and it would be made compulsory for shops to have provisions to check the “gold sold in the name of 24 carats is actually not of nine carats.” Matt Williams Womens Jersey
Tim Cook’s India visit: Apple to set up startup accelerator in Bangalore
Apple has launched an ambitious plan to tap into India’s startup ecosystem with the iPhone maker announcing plans to set up what it calls a “design and development” startup accelerator in India’s Silicon Valley, Bengaluru, at a time when the company is doubling down on India. Apple CEO Tim Cook, who landed in India late on Tuesday night, said that the new accelerator facility would help iOS developers create innovative apps for the company’s customers globally and that the new facility would provide resources to support entrepreneurs. ET had first reported on May 16 that Apple would announce plans for a new accelerator program during Cook’s maiden India trip. Apple said that the accelerator is expected to open in early 2017. “India is home to one of the most vibrant and entrepreneurial iOS development communities in the world,” said Apple CEO Tim Cook in a statement. “With the opening of this new facility in Bengaluru, we’re giving developers access to tools which will help them create innovative apps for customers around the world.” Apple said that it would work closely with app developers to “hone their skills” and bring them up to speed with the company’s global standards and best practices. “This is a huge vote of confidence in India’s developer community and a tremendous opportunity to gain world-class design and development expertise,” said Zomato CEO Deepinder Goyal. “Apple’s support will help drive growth and accelerate progress among the country’s vast talent pool.” Apple said that the company’s in-house experts would lead briefings and provide one-on-one app reviews for developers, while the accelerator would also provide support and guidance on Apple’s programming language Swift. “Swift enables developers to write safer, more reliable code, save time and create richer app experiences,” Apple said. Apple’s accelerator plans for India comes at a time when CEO Cook is betting on India to become a multi-billion dollar market for the company, amid a global slowdown in smartphone sales and also a slump in the growth of its flagship iPhone in key markets such as the US. Apple currently has around 3% volume share of the Indian smartphone market while by value it is around 11%, according to Counterpoint Research. However, in the premium segment or handsets priced over Rs 30,000, both Samsung and Apple are neck and neck, together accounting for more than 95% of the segment. Gerald McCoy Jersey
Could distribution be Patanjali’s Achilles heel?
Around December’15, Chitra Karthik, a Mumbai resident and a corporate tax consultant, paid a visit to her uncle’s house in Kerala. Her uncle had just started a Patanjali franchise on the first floor of his house. It had an array of Patanjali products of which she bought stuff worth Rs 1000 in one go. Unfortunately, she couldn’t buy a lifetime’s supply of goods so once they were over, she set out to buy them from her nearest grocery store in Mumbai. “For weeks I looked for Patanjali’s toothpaste ‘Dant Kanti’ in retail outlets near my house in Chembur. Finally I gave up and bought Himalaya’s toothpaste instead. Dant Kanti was great, my mother-in-law loved it too. But we don’t have time to hunt for toothpastes,” she says. She’s not alone. Soudamini Pani, 50, a fitness trainer, has similar woes even when one Patanjali Chikitsalaya (medical centre) is a stone’s throw away from her house. “They show a lot of ads for atta (wheat f lour), sugar, and pulses but when you go to the store, you find these things out of stock all the time. Biscuits and juices are usually available. But it’s the former they heavily advertise. Why put ads when you can’t meet the demand,” she questions. Patanjali’s Distribution Muscle There is a huge gap between demand and supply, admits Acharya Balkrishna, MD of Patanjali Ayurved, who’s recently been in the news for his 94% stake in the organisation. (A development touted as a strategic move to take the limelight off Baba Ramdev who has been the face of the company all this while). Balkrishna tells us that besides 1200 Patanjali Chikitsalayas, 2500 Aarogya Kendras, 7000 open stores in villages, and 5600 marketing vehicles, his team is working on launching 250 mega stores in tier-1,2 cities. In addition to that, Patanjali has modern trade tie ups with Big Bazaar and the likes of Reliance Retail, Hypercity, Star Bazaar (Tata Group), D-Mart, Spencer Retail, More (Aditya Birla Retail), Apollo Pharmacy, which allows it to cover over 4500 stores across India. Not to mention now you can order Patanjali products via e-comm sites/apps like Amazon, Big Basket, and Grofers. But here’s the thing: Modern trade only forms ~10% of the FMCG sales pie, says Vijay Udasi, SVP – sales effectiveness practice at Nielsen India. And from his interactions with marketers, he concludes that not more than 1% of Indian consumers buy FMCG through ecommerce. “Traditional trade (meaning the universe of kirana stores) constitutes 90% of the FMCG business. Especially for a new brand, how rapidly you penetrate traditional trade becomes crucial from a ‘make or break’ standpoint,” he adds. Failing to Crack the Kirana Code? According to industry estimates, Patanjali products are currently available in 2 lakh traditional retail outlets popularly called as kirana shops. That’s 1/30th the presence of Hindustan Unilever in the kirana universe (over 60 lakh outlets) the market leader in FMCG space who Patanjali has reportedly been giving sleepless nights to. As for Colgate and Nestle players Baba Ramdev took a direct dig at and threatened to oust within a year the numbers are 47 lakh and 35 lakh, respectively. Now, we understand it’s taken these players decades to reach these numbers and we should give Patanjali some time to bridge the gap between demand and supply. But none of these players claimed to ‘shut the gate in Colgate’ or ’cause the bird in Nestle’s logo to fly away,’ all while their loyalists were clamouring for their products. Patanjali did. What’s wrong with making lofty claims when consumers love your product? Here’s what: According to Nielsen reports: ‘Availability of the product’ is the single largest driver of FMCG sales (33%). And its shopper research suggests that 30%-40% consumers shift preference if their favourite brand is not available at the store. Chitra Karthik is perhaps one among the 40% who are likely to shift to other swadeshi products when they don’t find Patanjali close by. One may think North India will have a better distribution network of Patanjali than the west, south or east, simply because Patanjali is headquartered in Haridwar and has a wider following in that belt. But we found consumers from that zone highlighting similar issues. Kriti Sharma (@ KritiKSharma19), a law student from Chandigarh, tells us (via twitter) that she finds Patanjali stores in every second sector (residential division) but not in small next-to-the-house kirana shops. “That’s still an issue,” she says, adding that the Patanjali website also delivers products but it takes a little longer than usual. And perhaps a lot longer than what traditional FMCG procurement time ought to be. Retailer’s Side of the Story Lala Prasad, a retailer running Hari Om Super Market (a kirana shop in suburban Mumbai), says he gets enough customer queries for Patanjali but he won’t keep its stock. “The margin you get on Patanjali products is 5%-6%. At the most you make 10% on some products but the store’s maintenance requires 15%. I keep HUL products because the entire range gives me a cumulative of 50% margin. If I keep Patanjali, I incur losses. Mostly, customers choose a substitute they’ve been buying for years when they don’t find Patanjali in the store. Why should I worry,” he says. Not everyone is as dismissive as Prasad. Seema Chaudhary, who runs Sawla Provision Store in Goregaon (Mumbai), has been trying to search for Patanjali distributors online. “I can assure them their stock will be bought at the snap of fingers, but no distributor delivers Patanjali stock in this entire area,” she says. There were at least 18 kirana shops we spotted within 500 metres of Sawla Provision Store all of them stocked some or the other HUL, Colgate, Dabur, Nestle product. None of them had a single Patanjali product. Most of them were willing to stock them despite low margins, but were struggling to find distributors willing to sell the same to them. Distributor’s word Margins are low and they can be better, says Gaurav Kanodia,
Proposed levy on online advertisements will burn a hole in the pocket, say startups
Fledgling startups say that the proposed 6% equalisation levy on online advertisements will burn a hole in their small pockets if it goes through. “The levy puts us in a precarious position because all these companies-Google and Facebook- which are the most popular advertising platforms for us, are going to make us pay more at the end of the day,” said Manik Mehta, cofounder Leaf Wearables, which is a smart jewellery startup that works in the area of women safety. An eight-member committee on taxation of ecommerce had in March proposed that services ranging from online advertising and cloud computing to software downloads and web hosting be subject to an “equalisation levy” of 6-8% of gross payment if the provider of the service is a foreign entity without a “permanent establishment” in India. The rationale behind the levy was is to way for the government to get foreign internet companies such as Google and Facebook to pay taxes in India. “Under the existing law and double taxation avoidance treaty, India will not be able to tax them. How can India allow this kind of revenue loss?” said Rashmin Sanghvi, a chartered accountant and an expert on international taxation and taxation of ecommerce, who was part of the equalisation levy committee. However, because of the nature of the levy, the companies will not be eligible for credits in their home countries, which means the levy is likely to be passed on to users of their advertising platforms, such as startups and small and medium businesses. Online advertising makes more sense for startups because of its targeted reach and lower cost, but the additional levy would mean they could end up paying 6% over the 14.5% service tax. For startups such as digital media agency Corpus Digital, which works on digital campaigns for small businesses, the levy could mean increased difficulty in collecting payments and eventual loss in business. “Typically, for an SMB client, the media spend is between Rs 50 lakh-Rs 1 crore a month. The taxes are over and above this cost- service tax is 14.5% and 10-15% is the agency’s commission. Collecting this money is also painful sometimes, and now if a further 6% is added, small businesses that we deal will might decide to change the structure of their digital spends altogether, and we could end up losing bsuiness,” said Sarita Singh, founder of Gurgaon-based Corpus Digital. Committee members agreed that the question of startups or Indian businesses having to pay this cost was discussed at length in the deliberations before the recommendation for the levy was finalised. “This is a tax on non-residents, and if startups are unable to bargain properly with them, it will be a burden on the startup,” said Nihar Jambusaria, chairman, committee on international taxation of the Institute of Chartered Accountants of India (ICAI), who was also part of the Committee. He added that the government wants to “test” this levy with online advertisements to begin with, and will have to find an alternative to get non-resident companies credits, similar to the way the Mauritius treaty has been re-negotiated. “Its quite ironic that the Prime Minister’s entire election campaign did marketing online. They used the online medium to reach the maximum people, but this can’t happen in the future. The cost and budgeting will be affected a lot,” said Leaf Wearbles’ Mehta. He added that the hardware startup business is very complicated and not start up friendly, so they would be “impacted even more”. Kyle Long Jersey
India suffers from huge gender pay gap: Monster Salary Index
Amid raging debate over gender pay gap globally, a new report shows the figure for India stands as high as 27 per cent, where men earned a median gross hourly salary of Rs 288.68 while women earned Rs 207.85 per hour. As per the latest Monster Salary Index, by online career and recruitment solutions provider Monster India, in the IT services sector the median gross hourly salary was the highest at Rs 337.3. But the IT services sector has a huge gender pay gap of 34 per cent. Men in IT services earn Rs 360.9 per hour, while women earn only Rs 239.6 per hour. A sector-wise analysis shows the gender pay gap was highest in manufacturing sector (34.9 per cent) and lowest in the BFSI and Transport, logistics, communication, equally standing at 17.7 per cent. According to the report, some of the reasons behind gender pay gap could be the preference for male employees over female employees, preference for promotion of male employees to supervisory positions and career breaks of women due to parenthood duties and other socio-cultural factors. Worldwide, lack of pay parity has taken a centre stage with strong views being shared by sports persons, political and business leaders alike. Men often get higher salary offers than women vying for the same title in the same organization, Monster India Managing Director Sanjay Modi said. “Needless to say, the situation is far from desired in India, especially when the country is gearing towards inclusive development,” Modi said adding the task at hand is the pace at which this pay gap can be bridged. There is a strong need to create equal opportunities for all, particularly women, who are key contributors in the Indian job market, he added. Ironically, while education is considered as one of the major factors in influencing salaries, yet it is least paid sector in India. “If the government needs to fulfill its vision of ‘jobs for all’ and a skilled India, then we need a sound education ecosystem with high quality teaching staff. Hence, it has become imperative to make the salaries of teachers and researchers competitive, if not lucrative,” Modi said. Monster Salary Index is an initiative by Monster India in collaboration with Paycheck.in (managed by Wage Indicator Foundation) and IIM-Ahmedabad as a research partner. This report provides a comparison of wage and working conditions figures for three periods: calendar year 2013, calendar year 2014 and the first three quarters of 2015 (January September 2015). The sample used for the analysis consists of 31,193 respondents and contains only employees as wages of self-employed people are excluded. William Carrier Womens Jersey
Rouble continues gains as oil approaches $50 per barrel
The Russian rouble strengthened further on Tuesday, continuing gains from Monday as the international oil price hit new 2016 highs close to $50 per barrel. At 0800 GMT, the rouble was 0.7 percent stronger against the dollar at 64.44 and had gained 0.6 percent to 73.03 versus the euro. Brent crude oil, a global benchmark for Russia’s main export, was up 0.7 percent at $49.3 a barrel, after touching a 2016 high of $49.47 earlier on Tuesday. The oil price is being supported by supply disruptions and a bullish report by investment bank Goldman Sachs which said the oil market had shifted from surplus to deficit earlier than expected. “We regard the reaction of the rouble to oil market optimism as extremely restrained,” ING analyst Dmitry Polevoy said in a note. “Our estimates of the fundamentally justified rouble exchange rate give an even lower range of 60.50-62.50 per dollar for oil at $50 per barrel.” Despite the stronger oil price, Russian share indexes fell on Tuesday, losing momentum after gains on Monday and hit by a report that top gas producer Gazprom would pay a lower-than-expected dividend. The dollar-denominated RTS index was down 0.5 percent to 925 points, while the rouble-based MICEX was 1.2 percent lower at 1,897 points. Shares in Gazprom were down 2.9 percent, after newspaper Vedomosti reported the company had persuaded the government to let it pay just over 20 percent of its profit under international standards as dividend, rather than a previously proposed 50 percent. Timothy Chandler Womens Jersey
To revive power plants govt to ink gas deals with Gulf countries
In a bid to fuel stranded gas based power projects the government is negotiating long term contracts with leading gas suppliers in the Gulf region. The plan is to enter into contracts for importing 70-80 million metric standard cubic metres (mmscmd) of natural gas through long-term contracts of 10-15 years and at affordable rates. Given the price sensitivity of fueling a power project, the government wants these long term contracts in the price range of $5 per million British thermal unit (mmBtu). “With excess coal-based power available for states to buy at a little over Rs 2, the cost of fuel to power plants is the most important factor and so the government’s effort and insistence on long-term gas purchase agreements at low costs” explains a government official, who did not wish to be named. During his recent visit to Qatar and other Gulf countries, oil minister, Dharmendra Pradhan had re-negotiated contracts for importing gas, bringing down the price from earliar highs of $16 per mmBtu to less than $5 per mmBtu. “Similar long term contracts are being negotiated that will enable India to operate its idle gas-based power capacity” says an official in the know of the matter, who did not wish to be named. The source further explained that the government is unlikely to pay anything more than $5 per unit of gas, keeping the global slide in prices in mind. Top sources say that discussions with Oman and Iran are already underway. An internal report of the government circulated in early 2015 showed that power projects worth Rs 500 billion were stranded due to lack of gas linkage and warned that these would turn into non-performing assets. Of these stranded projects 13000 MW belonged to private developers. Through various initiatives including reverse auction of gas, some of these stuck projects have been pumped back into life. But still gas-based power projects with capacity around 12000 MW are stuck due to lack of fuel. This proposal to rescue stranded power plants involves power and oil ministries, and sources say that it has already been discussed and approved by the prime minister’s office. Top sources in these ministries without wanting to be quoted said that prime minister Narendra Modi’s recent visit to Saudi Arabia and forthcoming to Iran will further discussions on these contracts. “In the interest of 24×7 power for all and to ensure that investments made in these idle power plants don’t turn bad, the government is trying to provide cost-effective fuel linkages” said the source quoted earlier. Jonathan Quick Authentic Jersey
LPG connections to reach 50 million women through Ujjwala Yojana: Oil and Gas Minister
Union Minister of State for Petroleum and Natural Gas Dharmendra Pradhan on Tuesday said new LPG connections would be reaching 50 million women at the below poverty level (BPL) during the next three years through the Pradhan Mantri Ujjwala Yojana (PMUY), a scheme for providing free LPG connections to women of BPL households. We have set a target of giving a new LPG connection in next three years to 50 million women at BPL with government assistance. For that 80 billion funds have been allocated. This financial year, the Finance Minister has budgeted 20 billion rupees for this purpose and we have a target of giving 15 million connections this year,” Pradhan told ETV News head Jagdish Chandra in an exclusive interview here.”5,00,000 women in India, every year, lose their life due to domestic smoke. Millions of rupees are spent for treatment. Woman have to make lot of efforts to collect woods. So, after this LPG connection they will be relieved from all such effort and their health condition can be improved,” he added. On selecting woman consumers, Pradhan said a list has been prepared on Socio Economic Caste Census to segregate women population. “Under instruction of Supreme Court, both Centre and State government have jointly prepared a list based on Socio Economic Caste Census. From this financial year, both Centre and State government have agreed to implement many schemes based on this. Our department has also accepted SECC as base for implementing the scheme. There are seven deprivation point for rural areas in this SECC. Anyone who fulfills even one of the seven point, then she will be eligible for beneficiary. There are different point for urban areas. We are going by that,” he said. Talking further on publicising the Ujjwala scheme he said: “We are improvising the scheme regularly. We are rectifying from whatever reviews we get from different sources including media. Social media plays an important role in this. They are able to directly come in our contact through social media and we are acting upon it. There are 18 thousand distributors. 167 million consumers are there. In coming three years another 70-80 million consumers will be added. So, there will be some issues, which we will be happy to resolve.” Corey Liuget Womens Jersey
Petronet LNG Q4 net down 20% to Rs 2.39 billion on tax adjustment
Petronet LNG Ltd (PLL), India’s state-owned largestnatural gas importer, today posted a 20 per cent decline in net profit for the fourth quarter ended March 2016, on account of reversal of tax expenses that had jacked up profit in the corresponding quarter previous fiscal (2014-15). The company reported a net profit of Rs 2.39 billion for the three months ended March as compared to profit of Rs 3 billion in the corresponding quarter previous fiscal. “The net profit figure of the quarter is not comparable with the net profit of corresponding quarter. However, the Profit Before Tax (PBT) figures are comparable,” Director-Finance R K Garg said at a conference call. The company’s PBT jumped two-and-a-half times to Rs 3.51 billion during the fourth quarter last fiscal (2015-16) as against Rs 1.30 billion in the corresponding quarter. However, the slide in net profit by a fifth came despite a 19 per cent reduction in expenses to Rs 56.98 billion as compared to expenses of Rs 70.21 billion in the same quarter previous fiscal. Total income of the company during the quarter also dipped 15 per cent to Rs 60.65 billion as compared to 71.61 billion in the corresponding quarter. “Results were broadly in line with or estimate with Earnings Before Interest, Depreciation, Tax and Amortization (EBIDTA) at Rs 4.40 billion, a growth of 44 per cent quarter-on-quarter, while Profit After Tax came in at Rs 2.40 billion growing 34 per cent quarter-on-quarter,” equity research firm Emkay Global said in a note. For the full financial year 2015-16, Petronet’s net profit rose by a marginal 3.6 per cent to Rs 9.14 billion as compared to Rs 8.82 billion in the previous fiscal. Total income of the company dipped 31 per cent to Rs 273.03 billion from Rs 396.55 billion in the previous financial year. Petronet LNG is jointly promoted by state-owned firms GAIL (India), Oil and Natural Gas Corp (ONGC), Indian Oil Corp (IOC) and Bharat petroleum Corp (BPCL). The firm operates a 10 million ton per annum (MTPC) LNG terminal at Dahej in Gujarat and a 5 mtpa terminal at Kochi in Kerala with IOC, BPCL, GAIL and GSPC as key customers. The company had earlier this year renegotiated its long-term contract with RasGas of Qatar for purchase of 7.5 million ton LNG for 25 years, bringing down the price to less than $5 per million British thermal units from $12 per mmbtu. Petronet is currently working on a project to expand the flagship Dahej terminal’s capacity by 5 mtpa to 15 mtpa at a cost of Rs 24 billion. The company said it has already spent more than Rs 16 billion on the project and plans to spend additional Rs 6 billion this fiscal to ensure the project is completed by the end of this year. The Dahej terminal processed higher-ever quantity of LNG in the fourth quarter at 149 trillion British thermal units (TBTUs) as compared to 138 TBTUs in the corresponding quarter. For the full financial year 2015-16, the terminal processed 566 TBTUs translating into a capacity utilization of 111 per cent. However, lack of pipeline connectivity impacted volumes at Kochi terminal that handled only 14 TBTUs of LNG. Analysts said they were upbeat on the stock due to the pickup in long-term volumes, particularly after the RasGas contract renegotiation, completion of expansion of Dahej terminal and a likely solution for the issues of pipeline connectivity at Kochi terminal. Dante Fowler Jr Womens Jersey
KPMG to advise Modi govt on first oil block auction
The blocks have been classified into 46 cluster areas and will be bid out based on the recently announced revenue sharing model. Global accounting and consultancy firm KPMG has been chosen by the Modi government to advise on its first ever auction of oil and gas blocks set to kickstart next week. KPMG has been chosen from a group of consultancy firms based on an expression of interest floated by the upstream regulator Directorate General of Hydrocarbon (DGH) for selection of a knowledge partner for the first round of discovered fields bidding to be launched by oil minister Dharmendra Pradhan on 25 May. “KPMG has been selected by the government to manage the marginal fields bidding round. The scope of the work includes taking the blocks to the market and suggesting ways to attract investor interest during the international roadshows that will begin soon,” said an executive close to the development. He added the entire process will be run over the next three months. The government will auction 67 discovered fields that were earlier relinquished by state-run Oil and Natural Gas Corp (ONGC) and Oil India (OIL) amid a historic downturn in global crude oil prices. The marginal fields house more than 89 million ton of reserves worth over Rs 770 billion, according to the oil ministry. The blocks have been classified into 46 cluster areas and will be bid out based on the recently announced revenue sharing model as against the earlier controversial cost recovery regime. India conducted its ninth and last bidding round under the New Exploration Licensing Policy in 2012 awarding 256 blocks to exploration firms. Although the investment sentiment in the oil sector has been impacted by low crude oil prices, Vedanta-owned Cairn India Ltd, the private operator of India’s largest on-land oil and gas block in Rajasthan, said it would study the data of available blocks on offer for participation in the bid round. “We will evaluate data from the blocks being offered, to gain further understanding, for firming up our strategy for the same,” Cairn India Chief Executive Mayank Ashar told Business Standard. Of the 67 blocks on offer, 28 discoveries are in Mumbai offshore and 14 are in the Krishna Godavari basin off the Andhra coast. Also, 10 discoveries are located in the Assam shelf area, according to the oil ministry. Sean Rodriguez Jersey