Let’s begin with the news that made headlines this week. The record 470-aircraft purchase order placed by Air India with Boeing and Airbus could cost the airline around $70 billion going by their listed price, MD and CEO Campbell Wilson said this week. He added that the carrier plans to fund the same through a variety of options, including internal cash flow, shareholder equity and sale and leaseback arrangement. Wilson said, quote, “As a private organisation, we don’t discuss the details of our financing route. It will be a combination of many things. It will be part-financed in cash and shareholder equity and we will also be exploring other means like sale and lease back of aircraft,” unquote. Aircraft leaseback is an arrangement in which the company that sells an asset can lease back that same asset from the buyer. This method, popular in the aviation industry, releases the asset from the balance sheet of the original buyer.
Meanwhile, the Securities and Exchange Board of India may revive plans to create a central database or data repository to store beneficial ownership details of foreign portfolio investors, according to people in the know. The proposal to create such a central database was mooted a few years ago by the HR Khan Committee, but it was put on the back burner subsequently. Earlier this month, Sebi reached out to custodians asking for beneficial ownership details of offshore funds and FPIs against the backdrop of the Adani saga. The regulator has also circulated a list of 10-15 entities to ascertain whether they are investment managers or fund administrators of specific FPIs, according to reports.
Moving on. The Grievance Appellate Committee, a platform which will allow users to appeal against decisions of social media firms like Twitter or Facebook about blocking of content or accounts, will be the country’s first redressal forum which will function fully online. The chairpersons and other members of the three GACs constituted by the government will not have any office and not conduct any physical hearings. From the time of the filing of the complaints by users to hearing them and pronouncing the final order, everything will be conducted online. The portal for filing complaints was launched by the minister of state for electronics and IT Rajeev Chandrasekhar on Tuesday. He said the GAC mechanism is a key milestone in the evolving framework that ensures that the internet is open and safe.
Over to economy. India’s economic growth slowed to a three-quarter low of 4.4% in October-December 2022, with manufacturing remaining in the doldrums and key services industries registering sequential loss in growth momentum, according to data released by the National Statistical Office this week. Private consumption, the largest constituent of the gross domestic product, witnessed a rapid decline since the pent-up demand-driven resurgence in the June quarter and investment recovery in the current fiscal has been modest and its endurance doubtful, the data revealed. The real GDP growth in the last fiscal is now estimated at 9.1% compared with the earlier estimate of 8.7%.
In some more economic news, the government this week said that it has decided to discontinue imports of crude sunflower seed oil under tariff rate quota from April 1 this year, a PTI report said.TRQ is a quota for a volume of imports that enter India at specified or nil duty, but after the quota is reached, the normal tariff applies to additional imports. The directorate general of foreign trade in a public notice said that the last date for import of crude sunflower seed oil under TRQ has been revised to March 31, 2023. Further, no TRQs shall be allocated for the import of crude sunflower seed oil in 2023-24. Earlier in January, a similar decision was taken for crude soybean oil. The duty-free import of 20 lakh MT per year was earlier applicable for two financial years — 2022-23 and 2023-24 — for crude sunflower seed oil and crude soya bean oil. For crude sunflower oil, the TRQ was there till June 30 this year.
Lastly, the Department of Telecommunications is working on a proposal to bring communication-based apps such as WhatsApp, Telegram, Skype, Facetime, etc. under some form of regulation, where they pay an interconnect usage charge to telecom operators for using their networks. A token, one-time licence/registration fee may also be levied on such operators. However, it’s not clear at this stage whether such apps would need to pay a licence fee on a recurring basis as a percentage of their adjusted gross revenue. Official sources said that the proposal is in early stages and discussions are still ongoing. The Telecom Regulatory Authority of India is also working in this regard simultaneously and will shortly come out with a consultation paper.