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Russia looks to sell $11 bn stake in Rosneft to China, India; IDFC Alternatives to raise $300 mn realty fund

20 June, 2016

Russian president Vladimir Putin is looking to divest a 19.5% stake in state oil giant Rosneft OJSC to China and India as he looks to meet spending commitments before his possible re-election bid in less than two years, Bloomberg reported.

The Russian government expects to mop up at least 700 billion rubles ($11 billion) from the stake sale in Rosneft, in a deal that would set a privatisation record for the country, the report said.

It would also balance the near 20% stake that London-based BP Plc acquired in a landmark deal in 2013.

It may be noted that both China and India have evinced interests to acquire stakes in Rosneft. The acquisition is expected to strengthen their presence in the world’s largest energy exporting nation. However, it is not clear yet whether a joint deal would be considered.

Recently, ONGC agreed to buy 15% of Vankor, one of the largest Russian oil fields to go into production in the last quarter century, from Rosneft for around $1.27 billion.

IDFC Alternatives set to raise $300 mn real estate fund

IDFC Alternatives, the asset management arm of infrastructure finance company IDFC Ltd, plans to raise around $300 million real estate-focused fund that would focus on residential segment, The Economic Times reported.

IDFC Alternatives is gearing up to hit the road for raising the fund in the coming quarter. This would be one of the biggest realty-focussed funds raised during the current financial year.

The new fund would be raised from foreign limited partners (LPs), mainly based in the US and Europe, making it the second fund that IDFC is raising from foreign investors, the report said. In May, the company raised around Rs 475 crore from domestic investors under a separate real estate fund christened as IDFC Score.

NTPC to raise up to $250 mn via offshore green bonds

India’s largest power producer NTPC Ltd is looking to raise up to $250 million via sale of rupee-denominated offshore green bonds by the end of July this year, The Economic Times reported.

The move is being seen as the power producer’s efforts to enter into renewable energy space. The company received regulatory approval for the offering last year, the report said.

NTPC has a capital expenditure requirement of about Rs 30,000 crore in the financial year 2016-17 and it will be raising funds through combination of international and domestic bonds as well as internal resources, its director-finance Kulamani Biswal said in the report.

SBI named in the ‘Hall of Shame’ of banks funding cluster bombs makers

The state-run lender State Bank of India has been named in the ‘Hall of Shame’ list of 158 banking and financial companies across the world that have invested billions of dollars in companies making cluster bombs, The Economic Times reported.

The list included global companies such as JP Morgan, Barclays, Credit Suisse and Bank of America invested over $28 billion in seven producers of cluster munitions between June 2012 and April 2016, according to a report by Dutch campaign group PAX. The state-run lender is the only Indian entity on the list.

PAX said in the report that Convention on Cluster Munitions categorically bans use, production, stockpiling and transfer of cluster munitions and the investments have been made in these cluster bomb producers despite the international ban.

Manufacturing states will benefit most under GST, says Jaitley

Finance minister Arun Jaitley cleared the air over the issue of possible revenue loss of manufacturing states due to the proposed goods and services tax (GST) and said that the manufacturing states such as Tamil Nadu, Maharashtra and Karnataka will be the net gainers under GST.

“Manufacturing states, which believe that a destination tax will reduce their taxes, are also the ones that will gain the maximum out of service tax. So, when you net total it, I think the fear is a little overstated,” Jaitley said, according to a report in The Hindu Business Line.

This came after the Tamil Nadu government raised concerns about the possible impact of the GST on the fiscal autonomy of states. Also, Tamil Nadu chief minister J Jayalalithaa said in a recent meeting with Prime Minister Narendra Modi that GST would lead to a permanent revenue loss for “manufacturing and net exporting states like Tamil Nadu.”

Modi sets infra targets for key ministries to speed up action

Prime Minister Narendra Modi has set targets for infrastructure sectors for the current financial year and the same has been communicated to the key ministries, The Economic Times reportedciting a government official aware of the development.

The targets will now be monitored by NITI Aayog and reviewed by the prime minister himself on a quarterly basis, the report said.

Targets were communicated last week to ministries of railways, roads, ports, civil aviation and others, with detailed timelines. The move comes after the NITI Aayog made sectoral presentations to the prime minister last month and highlighted tardiness in many areas.

The prime minister has identified 26 action points under 12 heads for roads and 36 action points for railways under about a dozen heads that need quick action by ministries to implement them in a time-bound manner.

Power ministry will not cut govt stake in PSUs below 51%: Piyush Goyal

Power minister Piyush Goyal said he supports the finance ministry’s disinvestment plan for public sector undertakings but his ministry has decided not to bring down the government’s stake in state-run power companies below 51%.

“The finance minister can do whatever (as much disinvestment) he wants to do. We will support him. But we will not go for (reducing government stake) below 51%,” Goyal told the Press Trust of India, according to a report.

He also said that the control of the PSUs and management should remain with the government. The government divested part of its holding in PFC and REC last year.

The government has set a disinvestment target of Rs 56,500 crore for the fiscal. Of this, Rs 36,000 crore is to come from minority stake sale in PSUs and Rs 20,500 crore from strategic sale.

Govt to finalise national policy on software products soon

The central government is likely to finalise a National Policy on Software Products-2016 shortly, a move that is aimed at promoting talent and contribute a bigger share of software products from India to the global market, The Hindu Business Line reported.

The policy will help the government meet its target to have software products account for $100 billion of GDP by 2025 from around $6.1 billion today, of which nearly $2 billion is from exports, the report said.

Last week, communications and IT minister Ravi Shankar Prasad had a review meeting with senior Department of Electronics and Information Technology officials to take stock of the notes and updates regarding the policy, the report said. India’s IT industry is expected to grow to $350 billion by 2025 from worth around $143 billion at present, it said.

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Russia looks to sell $11 bn stake in Rosneft to China, India; IDFC Alternatives to raise $300 mn realty fund

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