Morning Scan: All the big stories to get you started for the day

A round-up of top stories from newspapers.

1. Central government to form single trade body to promote India’s exports

The government may soon finalize a structure of a single trade body to promote the country’s exports that would focus on specific products and markets to achieve exports worth $2 lakh crore by 2030. Likely to be called Trade India, it could be set up on the lines of Japan External Trade Organization and Korea Trade-Investment Promotion Agency of South Korea. It will replace the multiple export promotion councils, which will function under Trade India. Discussions have started on its broad contours, including its structure and function. A formal proposal could be made soon.

Why it’s important: There has been a felt need for a centralized agency to help the government identify key products and markets that can be tapped to improve exports and boost efficiency. It could strengthen Brand India and drive national strategy for overseas trade.

2. L&T, Afcons and JSW in race to build container terminal at Great Nicobar Island

Larsen and Toubro, Afcons Infrastructure and JSW Infrastructure are among the top firms competing to build the Rs 42,000 crore international container transshipment terminal in Great Nicobar Island, although the project faces environmental hurdles. The National Green Tribunal has stayed the Rs 72,000 crore Great Nicobar development plan. The project has faced opposition from environmentalists. The government, however, is keen to develop the mega terminal through a partnership with the private sector.

Why it’s important: The mega project in the pristine biological hot spot has raised the heckles of environmentalists. The government is, however, likely to push ahead with it.

3. India’s edtech sector put at risk over inflated valuations, says serial entrepreneur

The noise around just a couple of edtech firms could pose significant problems for the entire sector, and unless inflated valuations correct, sanity will not prevail in the industry, according to Ronnie Screwvala, co-founder of learning platform UpGrad and a serial entrepreneur. One or two players have given the entire sector a bad name, Screwvala said in an interview.

Why it’s important: India’s edtech sector saw dramatic growth during the pandemic. Capital inflows have moderated since then and top start-ups like Byju’s and Unacademy are tightening their belts. Valuations are now expected to be on a lower trajectory.

4. United Arab Emirates emerging as alternative to rupee trade with Russia

India and Russia are increasingly opting to route goods operations through third countries such as the United Arab Emirates, facilitating transactions in currencies other than rupee, rouble and dollar. The push is toward facilitating trade through the UAE as the country’s currency, the dirham, is pegged to the dollar and enjoys global stability.

Why it’s important: There seems to be not much interest in rupee transactions although the government has been promoting rupee-settled trades, which are gaining acceptance at a snail’s pace.

5. India’s bad bank to step up acquisitions after missing target of Rs 50,000 crore in 2022-23

The government-promoted National Asset Reconstruction Company will hasten the pace on acquisition of distressed assets the current financial year although it missed a self-imposed target of buying loans worth Rs 50,000 crore in 2022-23. The bad bank, sponsored by state-owned banks, acquired Rs 10,378 crore of outstanding loans last fiscal year from Jaypee Infratech, SSA International and Helios Photo Voltaic, about one-fifth of the target. All three loans were acquired for a consideration of Rs 3,636 crore.

Why it’s important: Although lenders have been quick to act on insolvent companies to recover dues, increased litigation has slowed the process. It remains to be seen if NARCL is able to achieve its aims.

6. Struggling venture capital firms set to pare bonuses, pay hikes

Venture capital funds are resorting to hefty cuts in bonuses and may offer annual salary hikes of no more than 8-10 per cent, a big drop from the 25 per cent seen at the height of the investment boom. Venture capital investments have dropped by a third to $25.7 billion in 2022 from $38.5 billion in the previous year, according to a March report by Bain and company and Indian Venture and Alternate Capital Association.

Why it’s important: The just-concluded financial year was a tough time for venture capital funds. A funding winter has ended a decade of easy money and belt tightening was only to be expected.

7. Government to direct wellness and health influencers to display qualification

The central government will soon toughen regulation of influencers, with guidelines for those promoting brands and products related to healthcare and wellness, a category that has a direct impact on people’s health, according to consumer affairs secretary Rohit Kumar Singh. The new norms will make it mandatory for influencers to disclose their qualifications to dispense advice on health and wellness. These qualifications must be displayed in an obvious manner for their audience to see and read, he said.

Why it’s important: Social media influencers are now seen to play an outsized role in promoting products. Tighter rules on critical sectors like healthcare might make their influence safer for consumers.

8. Reliance in advanced talks for partnership to sell Campa range of soft drinks

Reliance Consumer Products is in advanced talks with Chennai-based Bovonto soft drinks maker Kali Aerated Water Works for a manufacturing and distribution partnership to make and sell Reliance's Campa soft drinks range. Reliance had held discussions to acquire a majority stake in Kali Aerated Water Works before it bought Campa in August last year. Bovonto is one of the largest cola brands in the southern markets and competes with multinational brands Coke and Pepsi.

Why it’s important: Reliance has revived the iconic Campa brand and aims to disrupt the domestic market for aerated drinks currently dominated by Coca-Cola and PepsiCo. An interesting battle lies ahead.

9. Tamil Nadu to insist on complete ban on online gaming, says expert panel chief

The head of Tamil Nadu’s committee on online gaming has called for a complete ban in this space, arguing that regulation is not the solution. The state government is clear that a ban is the only way out and it will have to be implemented, retire high court judge K Chandru has said. Based on the four-member panel’s recommendations, an ordinance was passed by the state assembly that sought to ban online gaming.

Why it’s important: There has been increased concerns over online gaming in India. Although it is a sate subject, even the central government is looking at regulating the industry. A complete ban might be difficult to enforce as geographical boundaries are relatively easy to circumvent in the online space.

10. Home loans of over Rs 75 lakh to get costlier as risk weightage reverts to pre-pandemic levels

Interest rates will be dearer for those looking to avail home loans of above Rs 75 lakh. Rates are set to increase further with the risk weighting on such loans returning to pre-pandemic level of 50 per cent. The loan-to-value ratio returns to 75 per cent for loans of over Rs 75 lakh, which means a home loan borrower has to pay 25 per cent margin upfront to avail of a loan above Rs 75 lakh. According to the National Housing Bank data, 36.36 per cent of the individual home loans in 2021-22 was above Rs 50 lakh.

Why it’s important: Although banks have not yet increased rates, they are likely to review the situation and act soon. This might impact demand in mid-segment housing, which was seeing some revival.