“You are listening to the Expresso Business Update. Here is the latest news from the world of Indian and International business brought to you by The Indian Express and The Financial Express.
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“Let’s begin. According to a senior official, the Centre may make a pitch for calibrated hikes in the goods and services tax rates over the next couple of years, rather than a one-time trimming of the slabs from four at present to three. This view will be conveyed to states concerned about a possible drop in their tax revenues after June, when a five-year revenue cover for them will cease to exist. The Centre’s road map for GST rate hikes will factor in the need to take the weighted average GST rate from a little over 11% at present to the estimated revenue-neutral rate of 15-15.5% over a two-three year period, but won’t give a shock to the consumers by way of a sharp increase in rates. The source added that atre hikes on mass consumption and essential items will be more gradual.
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Meanwhile, Infosys on Wednesday missed estimates for headline numbers for the March quarter. However, the company offered an encouraging revenue growth guidance of 13-15% in constant currency terms for Financial Year 23. The software giant reported a net profit of Rs 5,686 crore for Q4 Financial Year 22, a drop of 2.1% sequentially. Revenues came in at Rs 32,276 crore, a growth of just 1.3%, while the ebit margin of 21.5% showed a sharp contraction of 200 basis points quarter-on-quarter. The management clarified the Q4FY22 results had been impacted by a one-off adjustment relating to a top client. Salil Parekh, MD & CEO, said the company was confident of reversing the impact. The IT major announced the contract value of large deals won during the March quarter at $2.3 billion.
Moving on. The Directorate General of Civil Aviation on Wednesday barred 90 SpiceJet pilots from operating Boeing 737 Max aircraft, after finding them not properly trained to fly these planes. A SpiceJet spokesperson said that the development would not impact its operations of Max aircraft. SpiceJet currently operates 11 Max aircraft and about 144 pilots are required to operate these 11 aircraft. The spokesperson said that Oo the 650 trained pilots on the Max, 560 continue to remain available, which is much more than the current requirement. At present, low-cost carrier SpiceJet is the only Indian airline operating the Max aircraft. According to earlier reports, the 737 Max suffered a recurring failure in its Maneuvering Characteristics Augmentation System, which caused two fatal accidents in which a total of 346 people died.
Now on to some news about the power crisis. Union power minister RK Singh has told state power generation companies to alter their fuel mix by using up to 10% imported coal to boost their output, as the country’s power shortage crossed 105 million units on April 12, compared with the recent peak of 82 million units on October 12, 2021. Separately, the power ministry allowed the gencos run by state governments to use tolling facility for up to 25% linkage coal, a move which would enable them to optimally utilise their fuel quotas in the plants nearer to the mines and boost their electricity output. The extra power produced thanks to the facility could be used by the gencos to supply to the states facing power deficits at negotiated tariffs.
The government on Wednesday removed a 5% basic customs duty on cotton imports to shore up domestic supplies of the fibre, an acute shortage of which has badly hit the country’s textiles-and-clothing value chain. Prior to the move, cotton imports in India were effectively taxed at 11% (including agriculture infrastructure development cess and surcharges). With the latest notification by the revenue department, the cess and the surcharges will also cease to exist, which will allow the import of cotton at zero duty. Prices of the commonly used cotton variety have more than doubled to breach the Rs 90,000-mark per candy of 356 kg since February 2021 when an import duty was raised.
More on economy. Commerce secretary BVR Subrahmanyam on Wednesday said that the government isn’t planning to undertake bilateral trade with Russia through a rupee-rouble payment mechanism in the wake of the Ukraine crisis. He, however, said the government is trying to ensure payments for exporters, who had supplied goods to Russia before the war broke out in late February, are not stuck. Financial Express was the first to report on April 6 that, after weeks of uncertainties, 35 of the 56 major exporters to Russia, identified by the commerce ministry, had just received payments.
And lastly, the share market is all set to remain closed for four consecutive days, starting from today. The trading on both indexes of the stock market – BSE Sensex and NSE Nifty – won’t take place on account of Mahavir Jayanti, Dr.Baba Saheb Ambedkar Jayanti, and Good Friday.
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