Daily Financial News Analysis – 26th May’20

Table of Contents

Artificial Intelligence to Fight Covid

Ravi Shankar Prasad: The world needs to delve deep into AI and come up with solutions to fight the Covid-19 pandemic.
Your life habits, your approach to life, maybe your over-aggrandizement of the world as a nation will change.
‘AI Solutions for Covid’ brought together eminent policymakers, scientists and industry leaders to brainstorm on strategies to accelerate artificial intelligence and data science adoption for finding solutions to tackle Covid-19.
Prasad said that the geopolitical and the geo-economic narratives are staring at changes due to the pandemic.
“When we talk about self-reliance, we do not mean isolating away from the world. Foreign direct investment is welcome, technology is welcome,” he said. “But a lot of it is about self-reliant India, which translates to being a bigger and more important part of the global economy.”
While the government has used technology extensively to tackle the coronavirus threat, AI poses challenges in the areas of privacy and ethics, Prasad said.
Top thinkers on the subject should come up with AI solutions that are relevant for the new post-Covid world as well as a way to resolve these challenges, the minister said.
While human beings have a conscience, it’s not clear if AI, which is supposed to process information like a human mind, can have that capability.
He said that while driverless cars excite him as an IT minister, they worry him as a law minister.
Aarogya Setu app is completely privacy proof and has been downloaded by 10 million people so far.

Minimum Wage

The government could defer mandatory increase in minimum wages for a year.
This move could result in an annual saving of ₹7,500 crore for the private sector as well as central and state governments.
The move is expected to impact more than 150 million workers.
As per government estimates, 30% of the country’s total workforce is covered under the Minimum Wage Act.
The government raises the cost of living allowance component in the minimum wages twice a year, in April and September.
The revision is indexed to the consumer price index-agricultural labour (CPI-AL) and typically the minimum wage increases 4-5% a year.
The statutory national floor rate is currently ₹178 per day. But minimum wage varies across states, sectors, skills, regions and occupations, ranging from ₹180 to ₹430 per day.
The revision cycle, too, differs for each state.
PROS AND CONS: anti-worker or protect jobs

Migrant Workers to Return after Kharif Sowing

The government expects migrant workers to return to work only after mid-July.
Sowing season for the kharif crop will be mostly over and the Covid-19 outbreak likely past its peak.
Mass exodus of workers to UP and Bihar was an annual phenomenon around this time.
According to the data interpretation of the Indian Council of Medical Research and National Disaster Management Authority, India’s Covid-19 cases would peak around mid-July.

Qatar LNG Pact

Qatar has agreed to discuss India’s demand to renegotiate the long-term LNG contract.
It reversed the stand it took just four months ago.
Crumbling spot prices and collapsing demand have put global suppliers under tremendous pressure.
Executives at Petronet LNG, which imports Qatari gas are likely to meet via videoconference with Qatargas executives soon to discuss how prices can be cut for the 5 million tonne a year of supply deal that expires in 2028.
Petronet is also planning to approach ExxonMobil to cut prices on its 20-year-contract for 5 mt a year of LNG from its Australian project.

Labour Reforms

Labour Minister Santosh Kumar Gangwar: Codifying 44 labour laws into four codes is a big step towards labour reforms.
Labour unions had opposed the changes and asked the International Labour Organization (ILO) to take up the matter with the Indian government.
Gangwar: We hope to see two of these four codes coming back to Parliament from standing committee in the next session.
Of the four labour codes, the one on wages has been approved by Parliament and has been notified by the government.
The codes on industrial relations and on occupational safety, health and working conditions are with the standing committee on labour.
The code on social security will go to the committee.
The labour unions have maintained that the state governments did not consult them before announcing such drastic changes, which they said were against the interest of workers.