Daily Financial News Analysis – 19th Feb’20

Table of Contents

The largest US nuclear delegation to visit India in five years held talks with senior Indian officials last week.

Collaborations in research and development
Advanced nuclear technology
Offering nuclear power plants in a range of sizes i.e. small modular, micro, and bigger plants of at least one gigawatt capacity

The visit came ahead of US President Donald Trump’s 24-25 February official trip to India next week.
The US side included representatives of the uranium enrichment supply chain as well as reactor builders.
It was the largest US delegation to visit India since the two countries in 2015 ironed out differences that cropped up after India passed its civil nuclear liability law in 2010, pinning responsibility in the event of an accident on the equipment supplier rather than the operator of the plant.
Energy starved India’s huge requirements of power

India-US Dairy talks

India-US trade talks have run into obstacles after Washington sought access for its dairy industry without addressing New Delhi’s concerns on the issue, almost ruling out any deal during President Donald Trump’s visit.
New Delhi insists on mandatory certification of dairy products by veterinary officials specifying that the source animal was not raised on feed made of bovine extracts, a religious issue in India.
The European Union, Australia and New Zealand provide this certification, but the US has been stalling on the issue.

Sitharaman assesses COVID-19 impact

Finance minister Nirmala Sitharaman held wide-ranging talks with government secretaries and senior executives of various companies on Tuesday to assess the impact of the coronavirus epidemic on Indian businesses.
US tech giant Apple said it won’t meet its revenue target for this quarter due to the impact of the disease.
Businesses worldwide are feeling the heat not only because of lower demand in the world’s second-largest economy, but also because Chinese factories, key global suppliers of products, have either shut down or are operating at a fraction of their capacities.
Representatives of micro, small and medium enterprises pointed out that payment receipts are taking time because of staggered supply of raw materials and requested banks to be flexible about guarantees.
“Shipping lines are still arriving and raw materials will be coming (from China) for the next week or so. So, it’s more a question of remaining prepared for any developing situation in the next few weeks,” Sitharaman
Confederation of Indian Industry (CII) said 45% of total electronics imports in India come from China.
One-third of the machinery and almost two-fifths of organic chemicals that India purchases from the world comes from China
It added that China’s share in imports is more than 25% for automotive parts and fertilizers, while 60-70% of pharmaceuticals in India are also sourced from China, according to the report.
India imports goods worth more than $1 billion from China in pharma, fertilizers, medical devices, inorganic chemicals and textiles sectors.
The pharma sector is particularly vulnerable as it is a matter of health of Indian citizens, and also has an unduly high dependency on China.
Industries such as tourism, aviation, textiles and solar power are expected to face the impact of the coronavirus at various degrees, which is likely to be visible from March onwards.

Tribunal to enforce power pacts

Raj Kumar Singh: Union government plans to set up a new tribunal solely to enforce power purchase contracts.
Union government, which is facing investor criticism over a controversial attempt by the Andhra Pradesh government to renegotiate clean energy tariffs with developers, plans to amend the Electricity Act of 2003 to create the tribunal that will be headed by a retired judge.
The tribunal will also deal with contract issues where electricity distribution companies (discoms) don’t buy the full quantum of electricity agreed upon in the power purchase agreement (PPA).
It will function in addition to the Appellate Tribunal for Electricity and regulators such as the Central Electricity Regulatory Commission and respective State Electricity Regulatory Commissions.
To enforce a contract, the tribunal will be armed with powers that include a legal framework to recover the contract value of money owed, even by attaching property.
Mint reported on 18 November about the Centre exploring a law to protect investments affected by state governments’ decisions to scrap contracts.

Information Trust Alliance

The world’s biggest social media companies, including Facebook, Google, Twitter and ByteDance, are exploring an industry-wide alliance to curb fake news on their platforms in India, even as the government finalises regulations aimed at censoring content.
The proposed alliance — to be named the Information Trust Alliance (ITA) — will be a grouping of digital platforms and publishers, fact checkers, civil society and academia that will aim to control the spread of harmful content, including fake news and hate speech, according to documents reviewed by ET.
The alliance proposes to run public awareness campaigns in schools, colleges and universities, conduct workshops with content creators, and work with academia to find innovative solution.
Everyone is interested, but it will take time to take it forward.

Bezos Earth Fund

Amazon founder Jeff Bezos announced he’s created the Bezos Earth Fund, his biggest philanthropic investment to help counter the effects of climate change.
Bezos is starting with $10 billion and will begin to issue grants in a few months.
“It’s going to take collective action from big companies, small companies, nation states, global organisations and individuals,” he said on Monday in a post on Instagram. “We can save Earth.”
There is tension within Amazon on the issue, with some employees saying the company isn’t doing enough and there is a threat of punishment for those who are too outspoken on the matter.
The company last year said it would reach 80% renewable energy use by 2024 and 100% by 2030, up from 40% today.
The effort relies on a fleet of electric vehicles.
For years, Bezos didn’t pursue major philanthropic projects, leading to public pressure as his wealth rose.