MARKETS, P8 ECONOMY, P2 INTERNATIONAL, P7 OVER 200 MEETINGS IN 6 MONTHS STATE OF THE ECONOMY FOR FIFTH STRAIGHT MONTH RBI steps up interactions with fintechs and industry bodies The huge gap between GDP & consumption inexplicable: Pronab Sen China’s economy suffers blow as factory activity slows BENGALURU, SATURDAY, MARCH 2, 2024 VOL NO. XXXVI 274, 16 PAGES, `12.00 FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E SENSEX: 73,745.38 ▲ 1,245.08 NIFTY: 22,338.75 ▲ 355.95 NIKKEI 225: 39910.82 ▲ 744.63 HANG SENG: 16,589.44 ▲ 78.00 `/$: 82.91 ▲ 0.01 `/€: 89.68 ▲ 0.30 BRENT: $83.35 ▲ $1.44 GOLD: `62,442 ▲ `432 IMD SEES EL NINO TURNING NEUTRAL BEFORE MONSOON THE PERSISTENT El Nino conditions are likely to turn “neutral” prior to the start of the monsoon, Mrutyunjay Mohapatra, director general, India Meteorological Department (IMD), said on Friday, reports Sandip Das. ■ PAGE 2 ADANI GROUP SETTO INVEST `75,000 CR IN MP THE ADANI Group will invest `75,000 crore in Madhya Pradesh across various sectors such as cement, roads, energy and natural resources, a move that would generate more than 15,000 jobs, reports Rajesh Kurup. ■ PAGE 5 STATES UTILISE 90% OF `1.05-TRN CAPEX LOAN FOR FY24 THE CENTRE HAS released over `95,000 crore or 90% of the `1.05-trillion fifty-year interest-free capex loans budgeted in the revised estimate for states for the current financial year, reports Prasanta Sahu. ■ PAGE 2 FE S P E C I A L S Grand Cherokee: A Jeep thing, tough to understand The Grand Cherokee is amazing off the road, but feels very basic inside. ■ MOTOBAHN, P7 Get cover for treatment at home Such insurance helps in case of non-availability of hospital beds ■ PERSONAL FINANCE, P8 foreignportfolioinvestorsbuyingalsocreated the rightful impact.” According to provisional data, foreign portfolio investors (FPIs) bought shares worth `128.94 crore and domestic institutional investors purchased equities worth `3,814.53 crore on Friday. Lakshmi Iyer, CEO - investment & strategy at Kotak Alternate Asset Managers,said:“Markets have been underesti- Feb GST mop-up rises 12.5% to `1.68 trn PRIYANSH VERMA New Delhi, March 1 ROBUST GROWTH THEGROSSGOODSandservicestax(GST) collectionsinFebruary(pertaininglargelyto Januarytransactions) came in at `1.68 trillion, marking a 12.5% rise on year, data releasedbythefinanceministryshowedon Friday.The mop-up was the third-highest everin anymonth. ThecontinuedrobustnessofGSTcollections was not exactly in convergence with the weak growth in private final consumption expenditure, revealed in national income data releasedonThursday. There was a 13.9% rise in GST from domestictransactionsandan8.5%increase in GSTfrom import of goods in the month, the financeministrysaid. It added that during February, net of refunds,GSTcollectionswere`1.51trillion, up 13.6% on year.This is for the first time net collectionswere published. Cumulatively, in April-February, the grossGSTmop-upstandsat`18.40trillion, which is 11.7% higher than the corresponding period of FY23. The average monthlygrosscollectionsforFY24is`1.67 trillion,higher than `1.5 trillion average in 2.22 2.23 Auto Consumer durables 3.73 3.44 including auto, capital goods, consumer durables and power Feb 29, 2024 IndusInd Bank ■ Six sectoral indices at new highs, 72,500.30 L&T 4.39 1.72% after rising by `4.3 trn % gain Titan Co 1,245.05 points `392 trn Top Sensex gainers JSW Steel 4.46 HDFC Bank, Reliance Industries, Larsen & Toubro and SBI top contributors to Sensex gains Investor wealth surges to 6.46 ■ ICICI Bank, Tata Steel BENCHMARK INDICES ROSE sharply on Fridayafterthefaster-than-expectedgross domestic product (GDP) growth in the third quarter of FY24 and positive global cues buoyed investor sentiment. TheSensex zoomed 1,245.05 points or 1.72% to close at an all-time high of 73,745.35.The Nifty also jumped 355.95 or 1.62% to hit a record closing high of 22,338.75. The indices closed up for the third consecutive day on Friday. The mid- and small-cap indices also rose, but the rise was comparatively subdued.Both closed up less than 1% each. Investorwealth surged by `4.3 trillion to `392 trillion.Itwas,however,still short of the all-time high of `393 trillion witnessed on February 23. ABalasubramanian,CEO,Birla Sun Life Mutual Fund,said:“Today’s market buoyancy came on the back of GDP numbers and sustained performance across all sectors.Global inflation,too,is showing signs of reduction, and hence, some element of Metal JOYDEEP GHOSH Mumbai, March 1 % gain 3.84 SENSEX Top sectoral gainers Capital 2.49 goods Bankex 2.48 March 1, 2024 matingIndia’sgrowthmomentumandwe saw some glimpses of that in the December GDP numbers. This has been buoyed by the strong capex growth as well.” According to Iyer, if one looks at the GVA(grossvalue added) growth,it's pretty much in line with 6.5%,still suggesting a strong growth backdrop. Continued on Page 9 Altman, OpenAI sued by Musk for putting profit before humanity GST collections (` trillion) FY23 FY24 Growth (in %) 1.49 1.68 DESPITE THE second advance estimate showing a lower nominal gross domestic product (GDP) in the current financial year than factored in the budget, finance secretary TV Somanathan said the government will stick to the fiscal deficit target (revised estimate) of 5.8% of GDP. ■ PAGE 2 73,745.35 1.58 1.74 ‘GOVTWILL STICK TO 5.8% FISCAL DEFICITTARGET’ FRIDAY FIREWORKS 1.49 1.65 THAILAND HAS replaced its ambassador at the World Trade Organization (WTO), Pimchanok Vonkorpon Pitfield, after India lodged a strong protest against her outburst against India at the consultation meeting on agriculture during the 13th Ministerial Conference in Abu Dhabi, a senior official said, reports Mukesh Jagota. ■ PAGE 3 Investor wealth surges by `4.3 trillion 1.46 1.68 THAILAND RECALLS WTO AMBASSADOR ON INDIA PROTEST GDP cheer for markets 1.52 1.72 NEWS SENSEX, NIFTY ZOOM TO RECORD HIGHS 1.48 1.63 IN THE Tesla CEO Elon Musk (left) was a co-founder of OpenAI; Sam Altman is the current CEO of the AI startup SARITHA RAI March 1 10.2 13.4 15.1 10.3 Sep Oct Nov 10.5 12.5 Dec Jan Feb the previous fiscal. In April-February, the GST collections, net of refunds, stand at `16.36 trillion,which is 13% higher than the same period of lastyear. Continued on Page 9 PVs record best February sales Feb manufacturing PMI surges to 56.9 PASSENGER VEHICLE (PV) sales continued to move in the fast lane in February,with the industry recording wholesale despatches of 373,177 units,up 11.3% comparedwiththesamemonthlastyear. This is the highest monthly sales in February ever. Further, the streak of bestevermonthlysalesalsocontinuedforthe 14th straight month. ■ PAGE 4 MANUFACTURING GROWTH IN February was at the fastest pace in fivemonths,fuelledbythe quickest increase in sales since last September and the strongest expansion in new export orders for 21 months.The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) rose from 56.5 in Januaryto 56.9 in February. ■ PAGE 2 TESLACEO ELON MUSK hassuedOpenAI and its CEO SamAltman,alleging theyviolated the artificial intelligence startup’s founding mission by putting profit ahead of benefitinghumanity. The 52-year-old billionaire,who was a co-founderofOpenAIbutnolongerownsa stake,said in a suit filed late onThursdayin SanFranciscothatthecompany’scloserelationshipwithMicrosofthasunderminedits original mission of creating open-source technologythatwouldn’t besubjecttocorporate priorities. Muskhasbeenamongthemostoutspoken about the dangers of AI and artificial general intelligence (AGI). The release of OpenAI’s ChatGPT more than a year ago popularisedadvancesinAItechnologyand raised concerns about the risks surroundingtheracetodevelopAGI,wherecomputers are as smart as an average human. “To this day,OpenAI Inc’s website continuestoprofessthatitscharteristoensure thatAGI‘benefitsallofhumanity,’”thelawsuit said.“In reality, however, OpenAI Inc has been transformed into a closed-source defactosubsidiaryofthelargesttechnology companyin theworld: Microsoft.” Continued on Page 9 Fee row: Google starts removing Indian apps Shaadi.com, Altt, 99acres & Naukri among those taken off Play Store JATIN GROVER New Delhi, March 1 GOOGLE ON FRIDAY started removing some of the popular homegrown apps from its Play Store, over a dispute on service fee payments, prompting some of the apps to term it a“DigitalEastIndiaCompany”.Thelistsofarincludes matrimonyplatformssuchasShaadi.com,Matrimony.com, Bharat Matrimony; Balaji Telefilms’Altt (formerlyALTBalaji),audio platform Kuku FM, dating service Quack Quack,Truly Madly,Naukri,and 99acres,among others. The removal from PlayStore isexpected to affect the business of these companies as new users would find it difficult to download them. Startups, in particular, would be badly hit. Users who have already downloaded the apps concerned would,however,not face any difficulty accessing them. Thedelistedappscanbedownloadedfrom the web or third-party app stores. Google said that 10 companies in the country, including many well-established ones, had avoided paying fees despite benefiting from the platform. It did not name the firms but many companies, including InfoEdge’s Jeevansathi,Shaadi.com and TrulyMadly,said they have received the notice of non-compliance from Google. The dispute relates to non-payment of a commission fee of 11-26% by the apps regarding transactions their users do within the app,also called in-app purchases. This came after the Competition Com- WHAT GOOGLE SAID AFTER GIVING THESE DEVELOPERS MORE THAN THREE YEARS TO PREPARE, WE ARE TAKING NECESSARY STEPS... MURUGAVEL JANAKIRAMAN, CEO, BHARATMATRIMONY WE NEED TO FREE INDIA FROM THE CLUTCHES OF SUCH MONOPOLY BY GOOGLE SANJEEV BIKHCHANDANI, FOUNDER, INFOEDGE WHAT INDIA NEEDS IS AN APP STORE THAT IS A PART OF DIGITAL PUBLIC INFRASTRUCTURE, LIKE UPI & ONDC mission (CCI) ordered Google not to restrict developers from using third-partybilling and processing services. Several homegrown startups have challenged the Play Store billing policy in the MadrasHighCourtandtheSupremeCourton the ground that the levy is too high,but have not got a stay order.The SC is currently hearing aplea bythe10 companieswhohave challenged this billing policy of Google. Continued on Page 9 Paytm bank fined `5.5 cr over money laundering AJAY RAMANATHAN Mumbai, March 1 A MONTH AFTER the Reserve Bank of India (RBI) directed Paytm Payments Bank (PPBL) to not accept fresh deposits or give credit, the Financial Intelligence Unit-India (FIU-IND) on Fridayimposedapenaltyof`5.5croreonPPBL forviolating moneylaunderingnorms. FIU-IND, the financial intelligence arm of thedepartmentofrevenue,initiatedareviewof PPBL on receipt of specific information from lawenforcementagenciesinrespectoffewentitiesandtheirnetworkofbusinessesengagedin a number of illegal acts, including organising and facilitatingonline gambling. “The money generated from these illegal operations,that is,the proceeds of crime were routed and channelled through bank accounts maintained by these entities with the Paytm PaymentsBank,”anotificationfromthefinance ministry said on Friday.After considering the written and oral submissions of the payments bank,FIU-INDfoundthatthechargesagainstit were substantiated. “The penalty pertains to issues within a business segment that was discontinued two years ago. Following that period, we have enhanced ourmonitoring systems and reporting mechanisms to the Financial Intelligence Unit (FIU),” a spokesperson from Paytm said in response to the notification. On January 31, RBI asked the payments’ bank to halt most of its operations afterFebruary 29. Subsequently, this deadline was extended to March 15.“The Comprehensive System Audit report and subsequent compli- FACINGTHE HEAT ■ Money generated from some illegal ops allegedly routed and channelled through bank a/cs maintainedwith Paytm Payments Bank (PPBL) ■ Paytm parent One97 Communications on Friday said it has decided to discontinue various intercompany agreements with PPBL ■ OnJanuary 31, ■ Paytm founder Vijay Shekhar Sharma recently resigned as parttime non-executive chairman and board member ofPPBL RBI had asked the payments’ bank to halt most ofits operations after February 29 ance validation report of the external auditors revealed persistent non-compliances and continued material supervisory concerns in the bank,warranting further supervisory action,” the notificationhad said. In2022,thecentralbankhadaskedthepaymentsbanktostoponboardingnewcustomers. Continued on Page 9 DISNEY-RELIANCE MEDIA GIANT MAY HAVE MONOPOLY WITH 75-80% SHARE OF SPORTING PROPERTIES Sports broadcast may become a seller’s market, say ad experts ALOKANANDA CHAKRABORTY New Delhi, March 1 THE MERGER OF the Indian media business of Walt Disney with Reliance Industries’Viacom18 will createamediajuggernautwith108plus channels and two giant OTT apps (Jio Cinema and Hotstar), besides the two film studios owned by Reliance and Disney India. It will also create a huge opportunity for the `70,000-crore company by reducingthebargainingpowerofthe mediabuyingagencies,expertssaid. “It heightens competition and enhances the negotiating power of the newly merged entity, enabling it to exert greater control over pricingandinventory,”saysHarshaRazdan,CEO,South Asia,dentsu. Take sports. Reliance-Disney THE AD FACTOR ■ Reliance-Disney will own IPL (TVand digital), ICC cricket tournaments (bothTV& digital), BCCI domestic cricket events, Pro Kabaddi League, besidesWimbledon ■ Indian advertising industry size: `93,166 crore ■ Ball to be in in 2023 ■ Sports adex (TV+Digital): `7,100 crore ■ Of which Disney India had a contribution of ~80% will have a virtual monopoly in the sports broadcasting arena with 75-80% of the sporting properties under its belt. It will own rights to money-spinnerssuchasIPL(TVand digital), ICC cricket tournaments (both TV and digital), BCCI domestic cricket events, Pro Kabaddi Reliance-Disney's court both in terms of ad pricing and packaging, according to industry experts League, besides Wimbledon, with close to 100 millionviewers having watched the sport on TV last year. In 2022-23,the sports advertis- ing revenue television and digital combined was upwards of `7,100 crore. “Marketers can expect increased reach and profitability, optimised content costs, and streamlined operations; on the flip side, they will lose pricing leverage as it often happens in a monopoly situation,”saysBhaskarMajumdar,a senior communication consultant. Last year’s digital and TV unbundling for the IPL, for instance, was viewed as an opportunity for brands with fintech, retail tech, ecommerce, edtech firms, which saw their ad spends cut by 20-40%, gravitating towards digital,and legacy advertisers staying put on TV. Now with broadcasting and streaming under one roof “it will become more of a seller’s market” says a media executive who doesn’t want to be identified.“The ball will be in Reliance-Disney’s court both in terms of pricing and packaging,” he adds. Elara Capital says the consolidation will relieve some strain on the broadcaster/streamer. It could result in bundled advertisement revenues, potentially mitigating the higher cost of IPL rights and reducing overall losses for the broadcaster/streamer as it happened when the IPL rights for TV and digital were split between two separate platforms, with digital offering it for free.“There was a big dent in the IPL revenues on TV, which could see some respite,”says Karan Taurani, senior vice-president,Elara Capital. Continued on Page 9 BENGALURU