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

India’s goods exports plummet 12 per cent in December, trade deficit widens

India’s merchandise exports fell by 12 per cent in December, the second decline in three months, as demand slowed down in major markets like the US and the European Union. Part of the decline was due to the high base effect. Since imports also declined after two years, the trade gap widened marginally to $23.76 billion in December from the previous month. Goods exports dropped to $34.48 billion, while imports fell by 3.4 per cent to $58.24 billion. To be sure, exports grew nearly 9 per cent in the first nine months of the current financial year.

Why it’s important: Outbound shipments have declined as rising interest rates and fears of a recession in Western economies have softened demand. The going could become tougher in 2023 as the global slowdown starts biting.

Wholesale price inflation cools to 4.95 per cent, lowest is 22 months

The wholesale price index in December slowed to a 22-month low at 4.95 per cent on a higher base and the easing of price pressure for food and manufactured products, commerce ministry data showed. In November, wholesale price inflation stood at 5.85 per cent. In the year-ago period, it was at 14.27 per cent. Food inflation, which excludes manufactured food items, was at minus 1.25 per cent as vegetable prices fell from their year-ago levels. However, the inflation rate for cereals, rice, wheat, and pulses went up in December.

Why it’s important: This is the third straight consecutive month that prices have risen in single digits at factory gates after remaining in double digits for 18 months. Seen together with cooling retail inflation, the latest numbers will provide some comfort to policymakers.

Adani Enterprises submit documents for Rs 20,000 follow-on public offer

Adani Enterprises, the flagship of the Adani Group, has filed an offer letter with stock exchanges for a proposed Rs 20,000 crore follow-on public offer. It might launch the public issue in the last week of January. The company might give a discount to retail investors. The stock has rallied as much as 94 per cent in the past one year and an astronomical 1,760 per cent in the past five years.

Why it’s important: The fundraising is aimed at mainly paring debt, which the Adani Group has accumulated in its recent breakneck pace of business expansion. This could be one of the largest offers to hit the markets this year.

Corporate India’s annual outlook most cautious in a decade on global headwinds

Nearly six in 10 corporate honchos in India, which translate to 57 per cent, are optimistic about the country’s 2023 growth prospects despite a global slowdown and inflationary and geopolitical concerns, according to a survey by PwC. This is “the most cautious outlook in over a decade”, PwC said at the World Economic Forum annual meeting in Davos. The survey showed that 78 per cent of CEOs in India and 73 per cent of global CEOs believe that global economic growth will decline over the next 12 months. It was the most pessimistic that CEOs have been in over 12 years.

Why it’s important: The PwC survey captures the uncertainty gripping the global economy since war started in Europe. High inflation, rising interest rates and a looming economic recession in the West has resulted in the gloomy outlook.

Supreme Court declines to stay Google penalty imposed by competition regulator

The Supreme Court has refused to stay the Competition Commission of India order that asked Google to make changes to its Android ecosystem by January 19. It asked the US firm to clarify whether it’s willing to adopt the same standards in India that it observes in Europe. The court was hearing Google’s appeal against the January 4 order of the National Company Law Appellate Tribunal, which refused to stay a Rs 1,337.76 crore penalty imposed by the antitrust regulator for anti-competitive practices.

Why it’s important: The stance by the apex court and appellate tribunal supporting the Competition Commission has put Google in a tight spot. The top court’s observation of following tight European standards in India could make Google’s executives sweat.

Viacom18 buys media rights for women’s Indian Premier League for Rs 951 crore

Viacom18 has secured media rights for the upcoming women’s Indian Premier League for Rs 951 crore over five years till 2027, outbidding sole competitor Disney Star. The Reliance -led broadcaster will pay a per match fee of Rs 7.09 crore for five years for the women’s T20 cricket league, the Board of Control for Cricket in India has said.

Why it’s important: Interest in women’s cricket is rising rapidly in India and Viacom18 wants to capitalize on that. Chances are that it will book profits over its investment despite skepticism by some media observers.

Data center companies push for reciprocity in cross-border data flows

Tech infra companies building digital storage facilities in India are petitioning the government to mandate local storage of user data as well as reciprocity in cross-border data flows. STT Global Data Centre and Yotta Infrastructure have said that ancillary industries such as power, real estate, and renewable energy, which are reliant on the growth of the data center industry, will be adversely impacted by free cross-border data flow. These companies asked for Indian users’ data to be transferred only to countries that allow their citizens’ data to be sent to India, and that a copy of data stored overseas be also kept in India.

Why it’s important: In an increasingly digitized world order, billions ride on data flows. It’s a knotty issue involving individual privacy as well as national security concerns. Policymakers have a task cut out for them.

India’s formal sector employees to get highest pay hikes in Asia-Pacific region

Employees in India are expected to get the highest average salary increments in the Asia-Pacific region in 2023, according to Korn Ferry’s latest India Compensation Survey, as companies face a shortage of talent, and the local economy remains more insulated than others from global shocks. India Inc is likely to see an average pay raise of 9.8 per cent in 2023, compared with 9.4 per cent last year, the survey predicted.

Why it’s important: This would be welcome news for India’s salaried class, which has seen strained household budgets in the recent past due to high retail inflation.

Cognizant’s new CEO wants management team to focus on winning large deals

Cognizant Technology Solutions Corp.’s new chief executive wants employees to prioritize winning large deals to drive revenue growth, boost morale, and improve investor sentiment, without getting distracted by leadership changes. Ravi Kumar, who became CEO after the board asked Brian Humphries to resign on January 9, will meet 1,000 senior leaders at the company’s annual strategy planning event in Abu Dhabi.

Why it’s important: Cognizant has faced a recent decline, marked by senior-level departures, high attrition, and clients reducing engagements, all of which impacted growth. It remains to be seen if Kumar can turn this around.

Reliance-BP consortium stops gas auction after ceiling on trader margins

The consortium of Reliance Industries and BP has suspended the planned auction of gas produced from its KG-D6 offshore block after the government capped traders’ margin on the resale of such gas. The partners would need more clarity on the latest government order on gas sales, especially since it affects the way gas can be auctioned, as well as the business prospects of RIL-BP’s gas trading affiliate.

Why it’s important: The government is looking at consumer affordability and the business grouping is looking to optimize profits. A middle road will have to be found.