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Companies: Pursuit of Profit

Our Bureau

New Delhi: The government will ta-ke tangible steps to boost corporateinvestment in roads and shippingwith business-friendly strategiesthat balance profitability with effec-tive project execution, Mansukh LMandaviya, minister of state for ro-ad, transport and shipping, has said.

“We are creating an investor-friend-ly model for private sector. Who willinvest in roads if there’s no profit?”the minister told corporate leaders atthe ET Roundtable on highways,ports and shipping on Thursday.

He said his ministry would sym-pathetically consider their sugges-tions that the PPP model needs to fo-cus on strengthening the element ofpartnership between the investorand the government.

"We must modify the public-priva-te partnership model as per the ne-ed of the day and there’s a constantneed to change the mindset at all le-vels. We’ll be coming up with a lot ofpolicy interventions in coming da-ys to revive the interest of privatesector," Mandaviya said.

He also said cashless paymentsand toll and upcoming GST law wo-uld transform the transportationand logistics sector by cutting downthe cost through simplified pay-ment and tax structure.

Business leaders were concerned abo-ut the PPP model, but also said it canhelp infrastructure take a giant leap.

"PPPs can bring the same revolu-tion as telecom in infrastructure.The government has taken a lot ofimportant measures but there’sstill a need to walk that extra mile,"said Puneet Dalmia, managing di-rector at Dalmia Bharat Group.

Essar Ports managing director Ra-jiv Agarwal emphasised the need for“real partnership” between stakehol-ders, along with access to low-costfunds and flexibility in contracts, inthe wake of uncertainties. “This willhelp revive confidence and invest-ment climate enabling achievementof the national objective of nationaldevelopment on the back of strong in-frastructure,” he said.

Feedback Infra chairman VinayakChatterjee said some solutions werealready available with the govern-ment. “The Kelkar report has calledfor a rational allocation of risksamong various stakeholders in a pro-

resources, International FinanceCorporation, Asia-Pacific, said fundswere readily available for the sectorbut there were several obstacles suchas badly structured projects and issu-es of land acquisition.

Anand Kumar, MD, National Highwa-ys Infrastructure Development Corpo-ration, said all projects should be madepublic from the stage of planning itselfso prospective bidders know what is co-ming up in two years and they can plantheir resources accordingly.

Dispute resolution mechanism isanother area that needs to be addres-sed, industry believes. "The capacity ofdecision makers has gone down; mostdisputes are caused because of this.The government must empower offi-cers to make decisions independently,"Chatterjee of Feedback Infra said.

ject, and moving away from the one-size-fits-all approach to PPP modelconcession agreements,” he said.

Kaushik Pal, CEO-roads business,at Reliance Infrastructure, said hiscompany had gone all out to encoura-ge cashless tolling. However, the com-pany had to bear the cost of 1% thatwas charged on cards and wallets.

Industry leaders also emphasisedthe need to focus on optimisation ofdifferent modes of transport -- road,rail and costal shipping. Anil Rad-hakrishnan, chief executive officerat Adani Logistics Ltd, said the go-vernment should incentivise coas-tal shipping to make it attractive.

Participants also raised concernsabout the reluctance of banks to fundprojects. Malvika Pillai, portfoliomanager, infrastructure and natural

Govt to Take Tangible Steps to BoostPvt Investment in Roads, Shipping

(Sitting: left to right) Rajiv Agarwal, CEO & MD, Essar Ports, Malavika Pillai, Portfolio Manager-Infrastructure &Natural Resources, Asia, IFC, Mansukh L Mandaviya, MoS for Road Transport & Highways, Shipping, Vinayak Chatter-jee, chairman, Feedback Infra and Kaushik Pal, CEO-Roads Business, Reliance Infrastructure; (standing: left to right) Anil Radhakrishnan, CEO-Adani Logistics, Satish Parakh, MD, Ashoka Buildcon, KV Praveen, Head of Construction —Roads, Runways and Elevated Corridors, L&T, Puneet Dalmia, MD, Dalmia Bharat Group, K Ramchand, MD, IL&FS

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Pratik.Bhakta@timesgroup.com

Mumbai: The National Pa-yments Corporation of In-dia (NPCI) has ordered ICI-CI Bank to open up UnifiedPayments Interface (UPI)-based transactions imme-diately for PhonePe, the pa-yments application arm ofecommerce giant Flipkart.But ICICI said it was Pho-nePe which was indulgingin restrictive practices wit-hout naming the company.

“ICICI Bank has been advi-sed to open up UPI transac-tions immediately. We had adiscussion with ICICI Bankand Yes Bank — the bankerto PhonePe — to review thematter and arrived at this,”said NPCI in a statement tothe media on Thursday.

ICICI Bank had blockedUPI-based transactionsoriginating from PhonePeon Friday and said it hadtaken such a step becauseof “security-related con-cerns about the access toUPI data to a non-bankingapplication.”

The blocking was critici-sed on social media afterSameer Nigam, chief execu-tive of PhonePe, tweeted, re-porting such failures intransactions and complai-ning against the blockade.

“We look forward to ICICIBank unblocking transac-tions for PhonePe customerswith immediate effect. Toiterate, we have not madeany changes since we werecut off by ICICI Bank. We ha-ve always been compliantwith UPI guidelines and willcontinue to do so as the stan-dards evolve. This includesimplementing the new set of

guidelines for which NPCIhas set a deadline of Janua-ry 31 for all UPI-enabledapps, including PhonePe toadhere to,” Nigam said afterthe NPCI order.

Nigam declined to com-ment.

“A certain non-bankingapplication is following arestrictive practice of allo-wing only users of its ownUPI handle to make pay-ments on its App,” an ICICIspokesman said in a state-ment. “This is a clear viola-tion of UPI guidelines,which mandate interope-rability, wherein users en-

joy the fre-edom tochoose anyUPI handleto make pa-yments.”

While UPIas a systemis not ac-cessible tonon-ban-king pay-ment play-ers, manythird-par-

ty applications like Trupayand PhonePe have tied upwith banks such as YesBank to offer such servicesto its customers.

“The PhonePe applica-tion has complied with allthe prerequisites as man-dated by the network asso-ciation,” said Yes Bank.“The process laid out byNPCI involves detailed cer-tification, vulnerability as-sessment, penetration tes-ting, application security,third-party security auditsand a host of other proce-dural guidelines, all ofwhich have been compliedwith,” the bank stated.

ICICI Bank Askedto Give PhonePeAccess to UPI Deals

Bank hadblocked suchtransactionsfromFlipkart’spaymentsapplicationarm forallegedlyindulging inrestrictivepractices

Our Bureau

New Delhi: The competi-tion watchdog has held se-ven cement companies gu-ilty of bid rigging and car-telisation and imposed a to-tal fine of nearly .̀ 206 croreon them.

The companies are ShreeCement, UltraTech Cement,Jaiprakash Associates, JKCement, Ambuja Cements,ACC and JK Lakshmi Ce-ment. The ruling relates to atender floated by a Haryanaagency in 2012.

“The anti-competitive con-duct was reaffirmed thro-ugh SMS exchanged andcalls made amongst the offi-cials of the cement compani-es,” the finance ministry sa-id in a statement.

In a 120-page order, theCompetition Commissionof India also directed thecompanies "to cease anddesist" from such activitieswhile imposing penalty

equivalent to 0.3% of eachof their average turnoverfor three financial years.

UltraTech has to pay thehighest penalty of .̀ 68.30 cro-re, followed by JaiprakashAssociates (.̀ 38.02 crore),ACC (.̀ 35.32 crore), Ambuja(.̀ 29.84 crore), Shree Cement(.̀18.44 crore), JK Cement(.̀ 9.26 crore) and JK LakshmiCement (.̀ 6.55 crore).

The director of Suppliesand Disposals in Haryana --a procurement agency –had filed the case. The CCIhad ordered a detailed pro-be into the matter in 2014.

RAILWAY TENDERIn a separate case, the CCIhas imposed penalties onthree firms for bid rigging ontenders floated by Indian Ra-ilways for procurement ofbrushless DC fans in 2013.

The CCI took suo moto ac-tion under the CompetitionAct, 2002 based on informa-tion received from the Cen-tral Bureau of Investigation.

CCI Holds 7 CementCos Guilty of BidRigging, Cartelisation

Bloomberg

Davos: Analysts scratching the-ir heads over the impact on In-dia's banks of the country's moveto ban high-value notes have eve-ry right to be puzzled, as estima-tes offered by the chairman ofState Bank of India indicate.

The bank could retain anythingfrom 15% to 40% of the deposit bo-ost it received after the govern-ment withdrew about four-fifths ofthe banknotes in circulation in No-vember, Arundhati Bhattacharyasaid in an interview on Wednesdaywith Bloomberg Television's ErikSchatzker. She was unable to give aprecise estimate amid uncertaintyabout how much of that money ca-me from Indian businesses as op-posed to individuals.

If much of the money that camewas being used in business,“then much of it will get takenout because people will want touse it in their business again,”Bhattacharya, 60, said on the si-delines of the World EconomicForum in Davos, Switzerland.

“But if much of this money isfrom savings of people, whichwas sitting in their cupboards orwherever, then obviously it won'tgo out,” she said. “Once it's in thebank, it'll stay in the bank andtherefore that's why we have a ve-ry wide kind of range.”

For weeks, investors have specula-ted over whether the surging bankdeposits caused by the November 9ban on high-value notes will ultima-tely benefit lenders. The S&P Ban-kex Index, which tracks 10 lenders,rose almost 4% following the move,before slumping 13% and has sinceclawed back much of that slump.

“Retaining more deposits me-ans low cost funds that can belend out to improve bottom lineat banks,” Payal Pandya, a Mum-bai-based analyst at CentrumWealth Management Ltd., said

by phone. “Lenders focus shouldshift to deploying the money asloans as soon as they can.”

Prime Minister Narendra Modistunned the nation by banning old.̀ 500 and .̀1,000 notes, a move thatdragged cash-intensive businessesto a standstill and had millions of In-dians lining up at banks to deposittheir now invalidated currencies orexchange them for new notes. Theresulting liquidity surge broughtfunding costs down for lenders in-cluding State Bank of India, givingthem scope to cut interest rates.

SBI's low-cost deposits had sur-ged by 1.4 trillion rupees after thecash ban and the lender is seeing“unprecedented liquidity,” Bhatta-charya told reporters on Jan. 2 af-ter unveiling a rate cut. While thecompany's loan book had cont-racted after the ban, advances inthe year to March 31are expected toexpand as much as 9%, comparedwith about 6.7% as of December 31,she said the same day.

SBI May Retain Up to 40% ofDeposits: Chief Bhattacharya

State Bank Chairman ArundhatiBhattacharya attends the WEFannual meet in Davos REUTERS