RBI chief, panel face close call on rates Page II A month into the job, India’s central bank governor will on Monday and Tuesday chair his maiden policy review, which for the first time will see a committee set interest rates, though views are divided on whether there will be any change this time round.

Ins IdeIndia’s ‘biggest’ spectrum auction starts todayIndia’s biggest auction of telecom spectrum kicks off on Saturday with seven operators in fray for a total of 2,354.55 MHz across seven bands, towards which a reserve price of IRs5.66 trillion ($85 billion) has been fixed by the government. The compa-nies that have qualified for the auc-tion are Bharti Airtel, Vodafone India, Reliance Jio Infocomm, Reliance Communications, Idea Cellular, Aircel and Tata Tele, who have furnished total earnest money of IRs146.53 bil-lion. Given that earnest money depos-it is roughly 10 percent of what a tele-com operator can bid for, experts said the expectations of IRs5.66 trillion ($8.5 billion) was far-fetched. Pg: II

Nepse dips 13.53 points as book closure nearsThe Nepal Stock Exchange (Nepse) index dipped 13.53 points over the week on slowed demand due to the book closure declared by most listed companies. The secondary market opened at 1,766.91 points on Sunday and shed 36.27 points when trading closed. On Monday, the Nepse rose 26.46 points and closed at 1,757.1 points. On Tuesday and Wednesday, the index dropped 3.38 points and 4.62 points respectively. As the market closed for the week on Thursday, the Nepse inched up 4.28 points to close at 1,753.38 points. “Except shares that investors expected to provide good returns in the long run, demand for most shares slowed, pulling down the overall index,” said Sharada Nepal, managing director of Sagarmatha Securities. Along with the Nepse, the sensitive index that measures the per-formance of Group A companies slip-ped 2.57 points to 380.26 points. Pg: IV

Saturday, OctOber 1, 2016 (15-06-2073) kathmandupost.ekantipur.com

moneymoneyfinance&economyfinance&economy

kathmandupostthecross currency

US Dollar 106.90

Euro 119.53

Pound Sterling 138.47

Japanese Yen 10.58

Chinese Yuan 16.03

Qatari Riyal 29.35

Australian Dollar 81.36

Malaysian Ringit 25.85

Saudi Arab Riyal 28.47How to read tHe tableThe chart shows the rates of nine world currencies. Move across the table to find rates of exchange between any two currencies. One unit of the currency mentioned vertically is worth that amount in the currency mentioned horizontally.

USD EUR JPY GBP CHF CAD AUD INR NR

NR 106.9000 119.5300 10.5800 138.4700 110.2800 81.2000 81.3600 1.6015

INR 66.6339 74.3740 0.6585 86.3850 68.4320 50.6289 50.8280 0.6244

GBP 0.7713 0.8608 0.0076 0.7921 0.5874 0.5882 0.0116 0.0072

JPY 101.2000 113.0600 131.5789 103.8900 77.0500 77.2300 1.5186 0.0945

EUR 0.8958 0.0088 1.1617 0.9186 0.6825 0.6826 0.0134 0.0084

USD 1.1163 0.0099 1.2965 1.0272 0.7601 0.7627 0.0150 0.0094

F o r e X

Exchange rates fixed by Nepal Rastra Bank

suspension railway line

n People take photographs of a lithium-battery powered train suspended from a railway line in Chengdu, southwest China’s Sichuan Province, on Friday. China’s first suspension railway line has finished its test run. The train, which has a speed of 60kmph, successfully ran along the 300m test section. Xinhua

C M Y K

Agence FrAnce-PresseSAN FRANCISCO, SEPt 30

BlackBerry has joined Yahoo, Nokia and other technology industry stars felled by an inter-net age in which companies are forced to evolve quickly or perish.

Canadian-based BlackBerry announced Wednesday it would halt in-house production of smartphones, marking the end of an era for the once-dominant handset producer.

Originally known as Research in Motion, the company earned a dedicated following of “CrackB-erry” addicts and introduced mil-lions to the smartphone. But, its lustre faded with the introduc-tion of the iPhone in 2007 and the large number of low-costs Android handsets that followed.

BlackBerry travelled a road well-worn. Finland’s Nokia, once the world’s largest mobile phone

maker, has seen its smartphone business go up in smoke as well. Internet pioneer Yahoo recently inked a deal to sell its core busi-ness to US telecommunications firm Verizon after years of strug-gling in vain to revive growth in an online search market usurped by Google. “What they have in common is that they haven’t reacted well to rapid change from their original positions,” said Endpoint Technologies Associates analyst Roger Kay. “Tech has high velocity.”

The tech sector is young and fast-moving in an internet cul-ture that praises “disruption” and “revolution” of industries and lifestyles.

Among mottos found on the walls of leading social network Facebook is “Move fast and break things”. Smartphones themselves have become seemingly indispen-sible, with people typically

replacing handsets every year or two in order to have the newest features or capabilities.

Changing to capitalize on a new trend can be daunting for companies comfortable with products that keep revenue flow-ing for the moment. “It reminds me of all those old singers going to Las Vegas to do whatever it is they do when they should really have just stopped,” Kay said of tech companies sticking with what early hits. “Everybody wants to do an encore and get paid again.”

When Apple launched the iPhone in 2007, some critiques questioned why the California company was “cannibalizing” its successful line of iPods. The iPhone became a global sensa-tion, and a main driver of stellar profit for Apple.

Kay noted that when Yahoo ruled internet search it became

clear their model was under attack by a newcomer called Google. Yahoo may not have seen the threat, or may have blinded itself to the need for change because its old business model

continued to pump revenue, according to Kay.

And while there are individual specifics underlying the downfall of incumbent mobile phone titans, they all faced the sudden and simultaneous rise of two powerhouses

Apple disrupted smartphones and lifestyles with its iPhone, and Google fired back with an Android mobile operating system that any consumer electronics maker was free to use.

The Google and Apple one-two punch was enough to essentially “pivot” a smartphone market that incumbents thought was too sta-ble to rattle, according to inde-pendent Silicon Valley analyst Rob Enderle. “None of the big firms were prepared to deal with it,” Enderle said of two compa-nies new to the smartphone scene fueling a revolution.

Unlike the birth of search

engine Google on a young and growing internet, mobile phones were an existing market that incumbents felt they knew well and were “completely taken aback by the combination of Apple and Google,” Enderle said.

Veteran technology firms being overtaken by newcomers is not necessarily inevitable, if established companies have the wit and courage to re-invent themselves, adapting to survive.

Analyst Kay noted IBM, a century-old technology company that has embraced transforma-tion time and again, even shed-ding products along the way. Computer chip giant Intel shifted its focus to microproces-sors for mobile devices to adapt to how internet-connected devic-es were evolving.

Apple itself was a computer company on the brink of bank-ruptcy when it staked its future

on iPods and iPhones in a win-ning move that made it one of the most profitable companies on the planet. The future is a question mark for Microsoft, once the world’s largest company, which has fallen behind Apple and Google as the PC industry declines and which is refocusing on enterprise services.

But reinvention isn’t a cure-all, and needs ongoing commitment to change along with vision of where markets are heading. IBM now seems tangled in endless restructuring, with revenue declining for more than four years; Intel continues to struggle to find the kind of success it had with big computer chips.

Analysts have taken to wondering whether Apple itself has become too dependent on the iPhone, and is taking too long to come up with “the next big thing”.

BlackBerry lesson: Adapt or die in the internet Agesu rv i va l o F t H e F i t t est

Changing to capitalise on a new trend can be daunting for companies comfortable with products that keep revenue

flowing for the moment

All domestic flights from KTM sold outPOsT rePOrTKAtHMANDU, SEPt 30

All domestic flights out of Kathmandu have been sold out as the Dashain travel rush, the largest annual migration in Nepal, begins.

Airline officials said that travel-lers were scrambling for tickets as they wanted to avoid a long and tedi-ous overland trip due to the poor condition of the Narayangadh-Mugling Highway, a key route link-ing the capital with the country’s eastern and western parts.

Moreover, a spate of recent bus crashes have made holiday makers nervous about travelling by surface transport.

Every year before the Dashain holidays, hundreds of thousands of people working or studying in the Kathmandu Valley return home to be with their families for the celebrations.

Last year, airlines saw an unprece-dented rise in the number of fliers due to the Tarai unrest when high-ways were blocked and overland transportation services came to a standstill.

The air travel rush has continued this Dashain with domestic airlines seeing extremely high traffic loads on all sectors.

Traditionally, seats on flights to destinations in the eastern sector—Bhadrapur, Biratnagar and Janakpur—would be snapped up during the Dashain holiday rush while things were somewhat quieter on flights to Nepalgunj, Bhairahawa and Dhangadhi in the western sec-tor. However, this year, airlines have

been reporting overbooking on flights to these destinations too.

“This year, we have seen excep-tional demand. There are no tickets available on any domestic sector,” said Rupesh Joshi, senior executive manager at Buddha Air. “We have added extra flights to cater for the rise in demand, but they are not suf-ficient to handle such a big rush.”

Buddha has doubled its frequency to six flights daily on the Kathmandu-Bharatpur sector. The carrier has added two extra flights on the Biratnagar sector to make seven daily flights. It has added one flight on the Bhadrapur sector to make three daily flights.

Likewise, Yeti Airlines will be operating two extra flights on October 6 and 8 and three flights on October 7 on the Biratnagar sector. It currently makes four daily flights to Biratnagar.

“We are not able to add flights on all sectors due to lack of aircraft, but

we are trying our best to make life easier for travellers,” said Bhim Raj Rai, media manager of Yeti Airlines. “Traditionally, demand rises during the Dashain festival, but this year it has been extraordinary,” he said

Even though flying is six to seven times costlier than travelling by bus, holiday makers are ready to make the extra expense. People fear driv-ing on the country’s bad roads, air-line officials said. Frequent bus crashes due to overloading and rash driving have also unnerved potential passengers.

As the festival season coincides with the peak tourist season, the Nepali skies record an average 300 domestic flights daily during October.

According to Tribhuvan International Airport statistics, domestic airlines receive nearly 17 percent of the 1.45 million annual traveller movement during this month.

festive travel rush

Upper Marshyangdi-A shut down at NEA’s orderAAsH gUrUngLAMJUNG, SEPt 30

The Nepal Electricity Authority (NEA) has ordered the Upper Marshyangdi-A Hydropower Project to shut down production four days after the plant started gener-ating electricity, project offi-cials said.

Energy Minister Janardan Sharma had announced the commencement of commer-cial operation at a special pro-gramme organised in Kathmandu on Monday while lawmaker Bhisma Nath Adhikari had inaugurated the plant amid a ceremony at the project site in Bhulbhule, Lamjung. “The state-owned utility ordered the project to stop producing power which had been fed to the national grid saying that the starting date of commercial genera-tion was yet to be decided. According to the NEA, the project is scheduled to begin commercial power generation in mid-October,” said Karna Adhikari, public relations officer of the project.

However, NEA Managing Director Kulman Ghising claimed that the authority had given no such instruction. “To my knowledge, the project is still in the test generation phase, and it has stopped gen-erating power to resolve some technical difficulties that have arisen,” said Ghising.

Another project source con-firmed that the plant had been

shut down to sort out a few technical issues that surfaced after it came online. The dam sluice gates have been fully opened to divert the water into the river so that mainte-nance work can be carried out.

A joint-venture of China’s Sino Hydro and Sagarmatha Power Company, the run-of-the-river project was started in 2012. Sino Hydro holds a 90 percent stake in the project while Sagarmatha Power Company owns the rest of the shares.

Upper Marshyangdi-A is the first hydropower project built with foreign direct investment. According to pro-ject officials, the total cost of the project stands at Rs16 bil-lion. The construction of the project was largely affected by last year’s earthquakes and border blockade.

The 50 MW project has two turbines, each generating 25 MW of electricity. The power-house is located at Bhulbhule-3 and a 6.5-km-long tunnel has been constructed to deliver water to the powerhouse from

the dam site located at Bhulbhule-5.

The NEA is yet to construct a transmission line to evacu-ate all the electricity generat-ed by the project. After the NEA failed to build the power line, the project itself erected a single circuit transmission line to evacuate power. However, it lacks the capacity to transmit all the power gen-erated by the plant.

Due to the absence of an appropriate transmission line, only 25 MW of the power generated can be fed into the national grid. The project has been complaining about the NEA’s tardiness in building the transmission line.

“Due to the NEA’s incompe-tence, only half of the total power generated is connected to the national grid,” said the project source.

The electricity produced by the second turbine will be added to the national grid after three months, according to the project. When the plant goes into full production, it will generate 317 million units of electricity annually.

Implementation of ‘no work, no pay’ provision difficultPOsT rePOrTKAtHMANDU, SEPt 30

The exuberance created by the inclusion of the provision on “no work, no pay” in the brand new Industrial Enterprises Bill may be short-lived, as the measure may not make any difference to employers unless the new labour law, which is being reviewed by the Parliament, grants the facility.

The Parliament on Thursday ratified the Industrial Enterprises Bill incorporating a provision that enables employers to deny payment to workers during the period when they do not work.

Although President Bidhya Devi Bhandari is yet to sign the bill into law, the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), the largest private sector umbrella body, has wel-comed the Parliament’s pas-sage of the bill.

However, there are doubts on whether the legal provi-

sion, aimed at reducing the number of unlawful protests in various industries, can be effectively implemented. “The provision on no work, no pay will not have legal teeth if the new labour law fails to embrace it. This is because the Labour Act, which deals with all kinds of work-related issues, will supersede the Industrial Enterprises Act,” Shekhar Golchha, vice presi-dent of the FNCCI, told the Post. “We are still seeking clarity.”

The private sector has long been demanding for legal pro-visions on “no work, no pay”, and “hire and fire”, after employees started halting pro-duction in the name of pro-tests and then demanding wages for the period when they did not work. Also, diffi-culties in slashing the work-force even when businesses

were facing deep financial problems had created hurdles for employers.

The new Labour Bill, which is currently being reviewed by lawmakers, has tried to address these issues. The Bill—which once signed into law—will replace the 24-year-old Labour Act-says employ-ees engaged in unlawful pro-tests will not get paid during the period when they remain absent from workplace.

Employees engaged in law-ful protests, on the other hand, will get 50 percent of the salary, says the Bill, which has defined lawful protest as demonstrations that were car-ried out by notifying the man-agement and the government.

The Bill has also paved the way for employers to lock up production units if employees engage in protests without providing prior information

to the management. The gov-ernment can, however, take action if such lock ups are arbitrary and carried out using false pretence.

Also, the Bill has included a provision that allows employ-ers to cut workforce if they face financial problems, or problems of overstaffing due to mergers.

Companies that have to completely or partially shut down their businesses due to various reasons can also cut workforce, says the Bill, which bars employ-ees from staging protest in properties other than where they are employed.

“Legal provisions aimed at creating business-friendly environment allow industries to grow, which will ultimately help in job creation process,” said Hari Bhakta Sharma, president of the Confederation of Nepalese Industries. “We welcome such initiatives.”

He, however, said labour relations were improving in Nepal of late, as “trade unions were getting matured”.

The measure may not make any difference to employers unless the new labour law, which is being reviewed

by the Parliament, grants the facility

moneyworld IISaturday, October 1, 2016 | thekathmandupost

C M Y K

investment meet

n Russian PM Dmitry Medvedev delivers a speech at the International Investment Forum Sochi 2016 in Sochi, Russia, on Friday. REUTERS

Thailand halts seahorse tradeJOHANNESBURG: Thail-and, the world’s biggest exporter of seahorses, is suspending trade in the animal because of con-cern about threats to its wild population. The decision was announced at a meeting of the Convention on Interna-tional Trade in Endan-gered Species of Wild Fauna and Flora, or CITES. Dr. Amanda Vincent, a seahorse expert at The University of British Columbia, said Thursday that Thailand ended its sea-horse trade earlier this year until it can make exports “sustainable.” Vincent says the Thai decision is “a way sta-tion to getting serious management in place.” Vincent is director of Project Seahorse, a group working with Thai authorities on seahorse conservation. The gro-up’s partner is the Zoo-logical Society of Lon-don. Seahorses are main-ly used in dried form for traditional medicine in mainland China, Hong Kong and Taiwan. (AP)

Nettlinx raises $3 millionHydERABAd: Nettlinx Ltd, the internet infrastruc-ture company, has raised $3 million from strategic investors as part of its plans to venture into industrial space by acquiring some European firms. The Netherlands-based EXchange Investors NV and Dubai-based TransGlobal FZC have been allocated share war-rants on preferential basis and will work closely with Nettlinx Ltd in its diversification, the Hyderabad-based compa-ny said in a statement. “These two funds will provide strategic support that will enable Nettlinx to identify and acquire companies with experi-ence in the industrial space. These funds will also help Nettlinx raise further capital and debt with lower interest rates from the European banks,” it said. (IANS)

Zee forays into radioMUMBAI: Indian content conglomerate Zee Entertainment Enterprises Limited (ZEEL) on Thursday announced its foray into the radio industry with the acquisition of UAEs Hum 106.2 FM radio sta-tion. This now enables ZEE provide an extensive media solution to its partners through televi-sion, radio and digital media. After being a pio-neer with the launch of India’s first Hindi satel-lite channel, Zee TV in 1992, Zee Entertainment was the first to launch a Bollywood TV channel, Zee Aflam in 2008 for the Arab audience as well introduce the Arab world to Hindi programs dubbed in Arabic with Zee Alwan in 2012. Commenting on the lat-est acquisition, Amit Goenka, CEO - Internat-ional Broadcast Busin-ess, ZEEL said in a state-ment: “Radio has been an area of interest for ZEE for quite some time and we felt that an inve- stment in Hum FM was the best option.” (IANS)

news digest

REUTERSBEIJING, SEPT 30

Millions of Chinese tourists are packing their bags for distant and not-too distant shores for the National Day holiday, with early indicators pointing to a slump in bookings for neighboring Taiwan and Hong Kong.

The “Golden Week” break, which starts on Saturday in one of the world’s biggest mass move-ments by plane, boat and train, offers an important snapshot of Chinese holidaymakers and their changing tastes and habits as eco-nomic growth at home stutters.

It is also a peak season for retailers outside China looking to lift their top line. Singapore is luring Chinese shoppers with dis-counts and promotions while South Korea is trumpeting a

month-long Korea Grand Sale.Shinsegae Duty Free in Seoul’s

Myeongdong area popular with Chinese has been making prepa-rations since July. “We are expecting many Chinese tourists, so we think sales will increase a lot,” shop official Ahn Joo-yeon told Reuters.

Thailand expects 220,000 Chinese visitors during the break, up about 30 percent from last year, Tourism Authority of Thailand Governor Yuthasak Supasorn told Reuters, despite a doubling in visa fees, a spate of bombings in the south of the country and fears of the spread of the Zika virus.

Thailand confirmed on Friday that Zika had caused two cases of microcephaly, a condition that results in babies being born with small heads, the first time the

condition had been linked to Zika in Southeast Asia.

“So far there has been no impact (from Zika fears) on our Thailand route,” said Wang Yanfei, market and PR manager at Shanghai Spring International

Travel Service, the parent of Spring Airlines. “We will give warnings and tips on our group notices. Team leaders will remind travelers of Zika and mosquito issues before the tour starts.”

Thailand’s tourism authority

said it expects Chinese visitors to spend 7.8 billion baht ($225 mil-lion) during the Oct 1-9 break, up 39 percent from a year earlier. Total tourist spending in China and by Chinese abroad is expect-ed to surge 13.5 percent to 478 bil-lion yuan ($72 billion) during the holiday, according to China Travel Academy, a govern-ment-backed research institute.

That would be four times Iceland’s gross domestic product. But the number of mainland tourists visiting Taiwan, a self-ruled island China considers a breakaway province, has taken a tumble. The decline reflects dete-riorating relations with Communist Party rulers in Beijing since President Tsai Ing-wen, of the independence-leaning Democratic Progressive Party, took office in May.

Chinese tourists traveling alone and in groups during the holiday will slump 50 percent from a year ago to 30,000, Taiwan’s tourism bureau said. “The drop in Chinese tourists numbers is mostly owing to polit-ical factors,” said Chiu Chui-cheng, a deputy minister of Mainland Affairs Council, Taiwan’s China policymaking body. “We still welcome Chinese tourists.”

China says it is natural its tourists are avoiding Taiwan given the current tensions between the two sides and what Beijing views as Taipei’s insensi-tive handling of a July bus crash, deliberately caused by the driver who set the vehicle on fire, killing 24 Chinese tourists.

Taiwan’s tourism bureau does not publish estimates for main-

landers’ spending during the hol-iday. It projects full-year spending of T$110 billion ($3.5 billion) ver-sus T$140 billion for 2015.

A reduced appetite for luxury due to a slower Chinese economy and a crackdown on extravagance has also hit visits to the former British colony of Hong Kong, which has been racked by pro-de-mocracy protests and anti-China sentiment in recent years, infuri-ating Beijing.

Paul Leung, chairman of the Hong Kong Inbound Travel Association, expects a 20-30 per-cent slide in mainland tour groups from about 300 tours a day last year.

“For tour operators, Golden Week is no longer a golden peri-od,” said Joseph Tung, executive director of the Travel Industry Council of Hong Kong.

Gold rush: Chinese head out on holiday en massep e a k s e aso n fo r r e ta I l e rs

RBI chief, panel face close call on ratesREUTERSMUMBAI, SEPT 30

A month into the job, India’s new central bank governor will on Monday and Tuesday chair his maiden policy review, which for the first time will see a committee set interest rates, though views are divided on whether there will be any change this time round. If the six-member monetary policy committee (MPC) is split over whether to hold or cut, Reserve Bank of India Governor Urjit Patel could end up exercising his casting vote. Regardless of the out-come, market players will closely scrutinise how the newly-formed MPC votes, try-ing to spot the doves and hawks among the six panel members—Patel, two other RBI officials and three gover- nment appointed economists.

The policy repo rate has stood at 6.50 percent since April. As inflation is likely to slow on the back of slumping food prices after a good mon-soon, most analysts expect the benchmark rate to be cut by 25 basis points this year—which would take it to its lowest since November 2010. But the question is when.

A Reuters poll showed 26 of

44 analysts surveyed expect the MPC to wait for more signs that inflation is easing and hold rates steady for now. But 16 economists see pros-pects for a 25 bps cut, while two expect an aggressive 50 bps cut. Leaving rates on hold would make it almost certain that the RBI would cut in December, analysts say. Some analysts urged the RBI to act now as inflation is fallen back within the RBI’s 2-6 percent target range.

“We expect a 25 basis point rate cut at the October policy largely because inflation is at 5 percent and is expected to remain around 5 percent for

most part of the rest of the fiscal year,” said Anjali Verma, chief economist at PhillipCapital. “Also, growth is largely tepid and therefore a rate cut is warranted now.”

But the RBI could opt to wait. The US Federal Reserve’s gradual approach to increas-ing rates has given India, and other emerging market econo-mies, extra time in a low rate environment to support their economies. Though the MPC has been given a mandate of “maintaining price stability,” it must do so “while keeping in mind the objective of growth,” according to the amended RBI Act.

India has been the fastest growing major economy, but it is still missing investment lev-els needed to sustain strong growth, and in the March-June quarter expansion slowed to 7.1 percent annually from 7.9 percent in the previ-ous quarter. A flare-up on the border with Pakistan has the potential to upset India’s mar-kets, though most analysts believe it would have to esca-late markedly to impact RBI policy. Investors are keen to hear Patel’s views as he has made no public appearances since becoming governor on Sept. 4, following three years as a deputy to his predecessor, Raghuram Rajan.

Patel is regarded as less likely to stir controversy than Rajan. The former International Monetary Fund chief economist had irked some members of India’s Hindu nationalist govern-ment with his socio-economic commentaries before quitting after just one three-year term.

Investors say they will seek clues to how Patel plans to steer the rupee through some pressure over coming months due to expected outflows of $25 billion as dollar deposits raised during a rupee crisis three years ago are due to mature.

n Reserve Bank of India Governor Urjit Patel

Weak spending, inflation hit Japan recovery hopesAgEncE FRAncE-PRESSETOKYO, SEPT 30

Spending among Japanese households tumbled last month and consumer prices fell again, data showed on Friday, after the Bank of Japan announced it was over-hauling a faltering bid to con-quer deflation.

The disappointing data marked the latest red flag for the world’s number three economy, and will put officials under ever-more pressure to find a way to kick-start growth.

Government figures showed that household spend-ing in August shrank 4.6 per-cent from a year ago, way below expectations for a drop of around two percent.

Core consumer prices, excluding volatile fresh food prices, fell for the sixth straight month, dropping 0.5 percent on-year—way below the BoJ’s two-percent infla-tion target. However, the labour market remained tight with unemployment at a mul-ti-decade low of 3.1 percent while factory output rose a stronger-than-expected 1.5 percent last month.

“The continued decline in underlying inflation should ring the alarm bells at the Bank of Japan,” said Marcel Thieliant at research house Capital Economics.

“Looking ahead, we expect underlying inflation to fall further to zero in coming months, which indicates that the Bank of Japan still has plenty of work to do to reach its two percent inflation target.”

Japanese officials are under intense pressure to deliver, as many economists increasing-ly write off Prime Minister Shinzo Abe’s spend-for-growth policy to fire up the economy, dubbed Abenomics.

Last week, the BoJ, which launched a massive bond-pur-chase programme to stimu-late growth, revealed yet another exotic weapon in its monetary policy arsenal. After a hotly anticipated meet-ing, the bank said it would

switch its emphasis from interest rates and concentrate its firepower on 10-year gov-ernment bonds.

Governor Haruhiko Kuroda said the bank would buy as many or as few of these benchmark instruments as necessary to ensure the yield—the interest rate paid to holders—remained steady at around zero.

The bank said it would cut back on the number of longer dated bonds the bank holds. That should reduce the price of long-term securities, which—in turn—should increase their yield.

It was the latest effort to convince Japanese consumers that the price of goods and services will rise in the future. Some analysts, however, said the move was an admission of defeat and a warning of the limits of central bank power.

On the government side, Tokyo in July announced a whopping 28-trillion-yen ($280-billion) package aimed at kick-starting growth, after Britain’s June vote to quit the European Union sent finan-cial markets into a tailspin and sparked a yen rally.

But Abe’s promises to cut through red tape have been slower, and his plan to buoy Japan’s once-booming econo-my have looked increasingly unrealistic.

India’s biggest spectrum auction kicks off todayIndo-ASIAn nEwS SERvIcE NEw DElhI, SEPT 30

India’s biggest auction of tele-com spectrum kicks off on Saturday with seven opera-tors in fray for a total of 2,354.55 MHz across seven bands, towards which a reserve price of IRs5.66 tril-lion ($85 billion) has been fixed by the government.

The companies that have qualified for the auction are Bharti Airtel, Vodafone India, Reliance Jio Infocomm, Reliance Communications, Idea Cellular, Aircel and Tata Tele, who have furnished total earnest money of IRs146.53 billion.

Given that earnest money deposit is roughly 10 percent of what a telecom operator can bid for, experts said the expectations of IRs5.66 tril-lion ($8.5 billion) was already far-fetched. Top investment banker Goldman Sachs has predicted that total proceeds from the auction will be around $7 billion—less than half of $16 billion that was fetched in the 2015 auction, and sharply below $85 billion if all spectrum was sold at the reserve price.

Ahead of the auctions, Telecom Secretary JS Deepak has said the process would be transparent and the award of airwaves quick. “One new bid-ding-friendly measure we have adopted this year is that spectrum won will be assigned within 30 days from the date of upfront payment.”

Interest on deferred pay-ment will be 9.3 percent this year against 10 percent in 2015. For the auctions—which will be an Internet-based, online process—the govern-ment has hired the services of ‘mjunction services’. The government said the mock

auctions conducted earlier this week went off well. The auction timings are from 9:00am to 7:30pm, Monday to Saturday.

The 2,300-plus MHz of air-waves on the block for telecom operators are in seven bands—700 MHz, 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz and 2,500 MHz. In the previous auction 470.75 MHz was on offer, which was set to fetch the exchequer $17 billion during its tenure.

The government has decided to allot the right to the spectrum won through auction for 20 years. The operators will have the choice of both upfront and instalments payment options. The service providers who win airwaves below 1 GHz bandwidth will have to pay 25 percent upfront, and for those winning above that, the upfront payment will be 50 percent.

For the successful bidder, the lock-in period of equity in the company has been reduced to one year instead of the ear-lier stipulation of a minimum period of three years or com-pletion of roll out obligation, whichever is later.

In a meeting of the cabinet in June, chaired by Prime Minister Narendra Modi, an official nod was given for the reserve price and the auction norms. The spectrum usage charge was subsequently fixed at 3 percent of the adjusted gross revenues of an operator.

the companies that have qualified for the auction

have furnished total earnest money of iRs146.53 billion

AgREEmEnT SignEd foR UK nUclEAR pRojEcTAgEncE FRAncE-PRESSElONDON, SEPT 29

The contract for a French-Chinese consortium to build Britain’s first nuclear plant in a generation was signed on Thursday at a low-key cere-mony, after a string of contro-versies threatened to scupper the huge deal.

The British government had delayed agreement over concerns about China’s involvement, while there were also questions about how the French state-owned power giant EDF would fund the con-struction of Hinkley Point.

The contracts marked “a significant step forward for a new era of nuclear power in the UK”, Britain’s business minister Greg Clark said in a statement after the signing, which was also attended by French and Chinese officials.

Britain finally gave the go-ahead earlier this month for the £18 billion (21 billion euros, $23 billion) complex, which is expected to provide seven percent of the country’s power needs, but it set condi-tions for the deal. The govern-ment has said EDF cannot cede majority control of the project and wants more scru-tiny over national security concerns for future projects.

EDF’s board gave its go-ahead on Tuesday for the project in Somerset, south-west England, which will not be operational until 2025. China has a one-third stake in the project and analysts had warned that Britain could have jeopardised relations with the world’s second-larg-est economy if it scrapped the deal. Critics said it could give China the power to turn off the lights. Jean-Bernard Levy, chief executive of EDF, said this month the move “relaunches nuclear power in Europe”.

Oil down as Russia waits on dealAgEncE FRAncE-PRESSElONDON, SEPT 30

Oil prices slipped on Friday, as Russia said it would wait for details of Opec’s surprise agreement to cut crude output before deciding on any chang-es to its own production.

The Organization of the Petroleum Exporting Countries—of which Russia is not a member—agreed this week to cut production by some 750,000 barrels a day in a move aimed at supporting prices.

“During October and November the Opec countries will work out the specific parameters of their propos-al,” Russian news agency Interfax quoted Energy Minister Alexander Novak as

saying. “We are talking about maintaining levels at volumes that have been reached, but it is still being discussed at what level,” Novak said, insisting he “would not comment on specific levels”. Around 1115 GMT, US benchmark West Texas Intermediate for deliv-ery in November was down 18 cents at $47.65 a barrel. Brent North Sea crude for November shed 55 cents to $48.69 a barrel compared with the close on Thursday.

Initial euphoria over what would be the first output cut by Opec in eight years sent

prices soaring six percent on Wednesday but the rally fiz-zled as traders began to ques-tion the cartel’s ability to see the deal through. A technical committee has been formed to flesh out the details ahead of the cartel’s formal meeting on November 30, including the allocation of the cuts for each of the cartel’s 14 members, who together pump out more than one-third of world crude.

“There are concerns about the execution of Opec’s new production targets,” said IG Markets analyst Chris Weston. “Even when the new

agreement is finalised, the actual reductions won’t mate-rialise until 2017 and the pros-pect of various nations exceeding targets is real.”

Following a meeting that included non-member Russia, Opec stunned markets Wednesday by saying it planned to trim total produc-tion. This followed talks in Algiers on how the cartel could prop up prices that have plunged from $100 in mid-2014 to below $30 at the start of 2016, mainly owing to excess supplies.

The deal came after Opec kingpin Saudi Arabia allowed bitter rival Iran to be exempt-ed from the cutbacks, as the Islamic Republic recovers from years of sanctions on its oil exports.

initial euphoria over output sent prices soaring 6 percent on wednesday but the rally fizzled as traders began to

question the cartel’s ability to see the deal through

n A file photo shows passengers at a railway station in Wuhan, Hubei. REUTERS

money economyIII the kathmandu post | Saturday, October 1, 2016

C M Y K

yacht show

n Luxury boats are seen during the 26th Monaco Yacht show, one of the most prestigious pleasure boat show in the world, highlighting hundreds of yachts for the luxury yachting industry, in Monte Carlo port, Monaco, on Friday. REUTERS

PepsiCo tops profit forecasts PURCHASE: PepsiCo Inc on Thursday reported third-quarter earnings of $1.99 billion. On a per-share basis, the Purchase, New York-based company said it had net income of $1.37. Earnings, adjusted for non-recurring costs and restructuring costs, were $1.40 per share. The results exceeded Wall Street expectations. The average estimate of nine analysts surveyed by Zacks Investment Research was for earn-ings of $1.32 per share. The food and beverage company posted revenue of $16.03 billion in the period, also topping Street forecasts. Five analysts surveyed by Zacks expected $15.89 bil-lion. PepsiCo expects full-year earnings to be $4.78 per share. PepsiCo shares have climbed 7.5 percent since the begin-ning of the year, while the Standard & Poor’s 500 index has increased 6 percent. The stock has risen 16 percent in the last 12 months. (AP)

EU takes Germany to courtBRUSSELS: The European Commission is taking Germany to court over its road toll system for private vehicles, claim-ing that the scheme is discriminatory. The EU’s executive arm says German law allows own-ers of cars registered in the country to have the toll deducted from their annual vehicle tax bill, making the system unfair to other road users. It also notes that prices for an annual toll sticker for cars regis-tered outside Germany are too high in some cases. The Commission said in a statement Thursday that the toll system does not comply with the European Union’s governing trea-ties on “non-discrimina-tion based on nationality and the free movement of goods and services.” It said that despite numer-ous exchanges with Ger-man authorities since 2014 its concerns have not been addressed. (AP)

Cosi files for bankruptcy NEW YORK: Cosi, the res-taurant chain known for its flatbread sandwiches, said it filed for Chapter 11 bankruptcy protection Wednesday and is seek-ing to sell itself to its lenders. The company has closed 29 stores, but said the remaining 76 Cosi restaurants located around the country will remain open as it goes through the bankruptcy process. In court docu-ments, Cosi Inc. said it has between $10 million and $50 million in assets and the same amounts in debt. Last month, the company reported a sec-ond-quarter loss of $3.1 million after reporting a loss of $3.8 million in the same period a year before. Cosi hasn’t reported profit since at least 1998, according to FactSet. The chain went public in 2002. Cosi said its lenders AB Opportu-nity Fund, AB Value Par-tners and firms connect-ed to Milfam, are provid-ing a $4 million loan to keep Cosi running. (AP)

news digest

Agence FrAnce-PresseRIYADH, Sept 30

Saudi Arabia, feeling the economic pinch from low oil prices, agreed to a surprise Opec production cut but remains determined to exert leadership over the world market, analysts say.

Over the past two years, the larg-est producer in the Organisation of the Petroleum Exporting Countries repeatedly turned down calls to cut output in an increasingly competi-tive global market. But Riyadh agreed at an informal meeting in Algiers on Wednesday to an Opec production curb of several hundred thousand barrels per day (bpd) to boost weak crude prices.

It had previously refused to cut output at a time when Iran, its regional rival, ramps up production after the lifting of international sanctions. But the collapse in Saudi

Arabia’s main revenue source already created a record budget defi-cit last year, leading to unprecedent-ed subsidy cuts and curbs on gov-ernment spending.

Under the Algiers deal, Opec out-put will fall to 32.5-33 million bpd from 33.47 million bpd in August, and Riyadh’s regional foe Iran will be exempted from the cuts. Shiite Iran hopes to return its output to a pre-sanctions level of around four million bpd.

Sunni-dominated Saudi Arabia and Iran have no diplomatic rela-tions and are at odds over a series of regional issues including the wars in Yemen and Syria. “No doubt, Saudi Arabia is feeling the econom-ic pain from low oil revenues. This is compounded by the war in Yemen and regional tensions,” Kuwaiti oil analyst Kamel al-Harami told AFP.

“But by facilitating the deal, Saudi Arabia has scored an impor-

tant political point. It has shown that it is still in control of Opec. It has reasserted its leadership,” he said. In doing so, “it has made some concessions” to Iran and other Opec members, Harami said.

Saudi Arabia has long been the only producer with spare capacity, allowing it to raise or lower produc-tion to influence the market under its traditional policy. But since 2014 it abandoned that approach to focus on protecting market share and drive out less-competitive players, including US shale oil producers.

That policy, and internal Opec squabbles, raised questions about

the relevance of the cartel which produces about 40 percent of global output. “Many Opec members are suffering economically from low prices. Their economies are stagnating or going backwards and they face budgetary issues,” said Greg McKenna, chief market strategist at forex broker AxiTrader. “So it appears the fiscal imperative seems to have trumped Opec’s inter-nal politics.”

London-based Capital Economics said a possible explanation for the deal was “that Saudi Arabia felt that any form of agreement, however flimsy, was needed to shore up Opec’s credibility”. Saudi policy-makers may also be “increasingly concerned by the impact of fiscal austerity on the economy”, it said.

Global oil prices fell from more than $100 a barrel in June 2014 to near 13-year lows of less than $30 in early 2016. “Saudi Arabia have per-

haps reassessed their dumping oil strategy to put US shale out of busi-ness as the pressure on their budg-ets has clearly reached a tipping point as well,” said Jeffrey Halley, senior market analyst at Oanda trading group. He sees a “major shift” by Saudi Arabia in allowing Iran to increase output.

Other analysts were more cau-tious. “As things stand, the deal doesn’t seem to amount to much,” Capital Economics said, expecting Riyadh to “rely on further fiscal consolidation, rather than an out-right shift in oil policy”.

An oil industry source told AFP it is too early to say there has been a change in Saudi policy but that internal economic factors could be “a strong driving force” for a poten-tial change. There is “no major shift,” in Saudi oil strategy, Spencer Welch, senior consultant at ISH Energy said.

In economic squeeze, Saudi seeks oil leadershipp r I c e ro u t

saudi Arabia has long been only producer with spare capacity,

allowing it to raise or lower production to influence market

House endorses 3 budget-related bills

Global IME signs MoU to acquire Reliable Dev Bank

POsT rePOrTKAtHMANDU, Sept 30

Global IME Bank has signed a memorandum of understanding (MoU) to acquire Reliable Development Bank, a national-level devel-opment bank registered in Kathmandu. Global IME Chairman Chandra Dhakal

and Reliable Chairman Radhe Shyam Agrawal signed the agreement on behalf of their respective organisations. The banks have agreed to com-plete the acquisition process within three months, accord-ing to a statement.

After the acquisition, the total paid-up capital of Global IME will exceed Rs8 billion,

whereas its deposits will increase to Rs88 billion. The bank will have 111 branches and loans and advances worth Rs74 billion.

Earlier, the bank had acquired Pacific Development Bank and completed mergers with Commerz and Trust Bank and three other finan-cial institutions.

Internet balloon: Google asks for airspace accessAgence FrAnce-PresseMONtReAL, Sept 30

Google, which is hoping to beam the internet to remote areas of the world via balloon, went before the UN’s aviation agency to ask member states to let it ply their airspace.

The company’s X Lab, which was created to pursue big-vision projects, said it hopes to establish a network of helium balloons floating in the stratosphere that will emit a powerful 4G signal to rural and difficult-to-access areas.

The new initiative — launched in 2013 and dubbed “Project Loon” — saw its first balloon take off from South America in February only to crash at a tea plantation in Sri

Lanka, where it was discov-ered by villagers.

Alphabet, the parent com-pany of Google, had partnered

with Sri Lanka to bring the internet to remote areas there. The country’s Information and Communication

Technology Agency, which coordinated the tests with Google, described the landing as controlled and scheduled.

Loon has “significantly improved the balloon design, manufacture and launch pro-cedure,” X Lab told the UN’s International Civil Aviation Organization (ICAO) Wednesday, according to a document seen by AFP. “The balloons are now robust, remaining aloft well beyond the targeted 100 days, and are launched through a custom developed auto-launcher, allowing rapid multiple launches,” X Lab told the organization’s executive com-mittee. After compiling pub-licly available wind data with its own flight data, Project

Loon was able to model the stratosphere’s air flow, allow-ing its balloons to “change altitude to ‘catch’ the winds moving at the speed and direc-tion necessary to a given ser-vice area,” the document said.

Alphabet requested the assistance of ICAO member states as they met for its 39th triennial assembly, asking them in particular to “estab-lish bilateral or multilateral letters of agreement with adjacent states and Project Loon to allow Loon balloons to safely transit flight informa-tion region boundaries.”

“Safety and coordination with the international civil aviation community is very important to Project Loon,” a X Lab spokeswoman told AFP.

POsT rePOrTKAtHMANDU, Sept 30

The Parliament on Friday rat-ified three bills to facilitate full implementation of the budget for this fiscal year.

The government on Thursday tabled Financial Bill, Bill to Raise Public Debt, and Loan and Guarantee Bill.

These bills were previously rejected by parliamentarians of Nepali Congress and Communist Party of Nepal (Maoist Centre), among others, to show they had lost confidence in the then government led by KP Sharma Oli.

The incumbent govern-ment, however, tabled the bills without making any change to the content prepared by the previous government, a sen-ior official of the Ministry of Finance told the Post.

Prior to tabling the three bills, the government on Thursday proposed suspen-sion of rule numbers 114 (1), 119, 120, 127 (1), 142 and 152 (1)

from the Legislature-Parliament Regulation.

The proposal was made as the government was tabling the bills for the second time in the same session of the Parliament — which the rules barred. This had created a hurdle for the incumbent gov-ernment to table the bills, because the same session of House has been continuing since the bills were first rejected.

The proposal to suspend the rules was endorsed by a majority of parliamentarians

on Thursday.After presenting a budget

of Rs1,048.9 billion on May 28, the government had forward-ed four Bills — Appropriation Bill, Financial Bill, Bill to Raise Public Debt and Loan and Guarantee Bill — to Parliament to facilitate budget implementation. Of these Bills, only Appropriation Bill has been signed into law.

Appropriation Bill is con-sidered as the main budget document, which allows the government to implement budgetary programmes and

utilise funds as per the alloca-tions made. Because of appr- oval of this bill, the govern-ment was not worried about rejection of three other bills.

Of the three rejected bills, Financial Bill allows the gov-ernment to collect taxes-the main source from which the government generates reve-nue to finance programmes laid in the Appropriation Act.

The Loan and Guarantee Bill, on the other hand, allows the government to borrow funds from foreign financial institutions, including the World Bank, the Asian Development Bank.

This Bill has proposed that the government’s foreign debt ceiling be raised to Rs700 billion from existing Rs500 billion.

The Bill to Raise Public Debt, meanwhile, allows the government to obtain loans from inside the country. The government plans to raise Rs111 billion in loans from the domestic market in the cur-rent fiscal year.

ASiA powERS 4pc RiSE in woRld ToURiSmAgence FrAnce-PresseMADRID, Sept 30

International tourism grew 4.0 percent in the first half of this year, with Asia posting the strongest growth, the World Tourism Organisation said on Thursday.

At around 561 million, the number of international tour-ists surged 21 million between January and June compared to the same period a year ear-lier, the Madrid-based United Nations body said in a state-ment. “Tourism has proven to be one of the most resilient economic sectors worldwide,” UN World Tourism Organisation (UNWTO) Secretary-General Taleb Rifai said in the statement.

Tourist arrivals rose at the fastest rate in the Asia-Pacific region, where numbers were up by nine percent due to “robust intra-regional demand”.

Africa, where an outbreak last year of Ebola in West Africa caused tourists to shun travel to the entire continent, posted a five-percent rise in international arrivals, with sub-Saharan African “recov-ering vigorously” with a 12-percent increase.

British Steel forges to profit after crisisAgence FrAnce-PresseSCUNtHORpe, Sept 30

In the fierce heat of a roaring blast furnace, liquid hot iron gushes forth from the taps, sending sparks dancing into the air at a sprawling steel-works in northern England.

The Scunthorpe complex is the latest reincarnation of British Steel, the former state-run behemoth that once tow-ered over the nation’s econo-my — and now appears to be in recovery mode after a deep crisis. “There’s been some dark times — periods of mass redundancy, a lot of negative press — but now we are start-ing to see positive results financially,” blast furnace manager Sam Thomas, 29, said as melted iron ore spewed in the background. “We’re also starting to feel a bit more like the morale is picking up,” said Thomas, who has worked at the facility for 11 years.

On its 100th day of trading on Thursday, the new British Steel announced that it was back in profit following a painful cost-slashing turna-round plan. “There were many months of uncertainty and we all worked hard to get to a profitable situation,” said Thomas, who oversees four gigantic blast furnaces estab-lished in the 1950s and named after queens of England — Anne, Bess, Victoria and Mary. The group, sold by India’s Tata Steel to invest-ment firm Greybull Capital in May, said Thursday it had turned from “significant”

losses over the last few years to a stage where it was now back in profit.

The region was thrown into disarray last year when Tata Steel put its European long products division up for sale as it refocussed on strip steel, in the face of a collapsing market. The move sparked worries that Scunthorpe — whose community of 65,000 inhabitants has been built around steel for generations — could become a ghost town.

Long steel products com-prise plates, rails for railways, sections used in construction, and wire rod. The latter can be used as steel rope for infra-structure like suspension bridges or filaments for car tyres to give rigidity.

In late 2015, Tata had scrapped Scunthorpe’s plates output — a key market which has been ravaged in recent years by China’s steel overca-pacity and the subsequent flood of cheap imports into Europe. In May 2016, Greybull bought the long products divi-sion — including a steel mill in Hayange in northern France — and renamed it British Steel in a deal under which Tata retained responsi-bility for the old British Steel’s costly pension scheme.

the region was thrown into disarray last year

when tata steel put its european long products

division up for sale

moneybazaar IVSaturday, October 1, 2016 | thekathmandupost

Note 7 sales to resume in SKoreaSEOUL: Samsung said Thursday it would resume sales of new Galaxy Note 7 smartphones in South Korea this week, hoping to turn the page on the troubled device after an ongoing global recall prompted by battery explo-sions. The company on September 2 suspended sales of the oversized “phablet” and recalled 2.5 million units shipped worldwide after faulty batteries caused the phones to explode while charging. With the recall under-way in 10 nations where the device had been launched, 60 percent of users in Samsung’s key market, the US, had swapped their handsets for replacements provided by the company, as of Tuesday. Eighty percent of Note 7 custom-ers are expected to complete the exchange this week in South Korea, where sales of new phones equipped with fault-free batteries will resume on Saturday, Samsung said in a statement. (AFP)

California suspends Wells Fargo tiesLOS ANGELES: The state of California has suspended sig-nificant business ties with Wells Fargo, dealing another blow to the bank struggling to contain the fallout from a bogus accounts scandal. In a letter addressed to Wells Fargo Chairman John Stumpf and the board of direc-tors, state Treasurer John Chiang said Wednesday he could no longer “entrust the public’s money to an organi-zation which has shown such little regard for the legions of Californians who have placed their financial well-be-ing in its care.” Wells Fargo, the second largest US bank by market value, has apologized and said it fired 5,300 people tied to the illegal conduct, which saw employees boost sales figures by opening unauthorized deposit and credit accounts and then covertly fund them with cus-tomers’ money. It has also paid $185 million in fines. (AFP)

Peugeot eyes 150k vehicle sales in IranPARIS: PSA Peugeot Citroen said it plans to sell more than 150,000 Peugeot vehicles in Iran in the second half of this year as the French carmaker seeks to reclaim the leading position it once enjoyed in the country. Peugeot, the biggest-selling European automaker in pre-sanctions Iran, suspended sales in 2012 when an international boy-cott due to Iran’s nuclear program was extended to cars. Most sanctions were lifted in January. The French car-maker’s sales peaked at 458,000 vehicles before its with-drawal, nearly 30 percent of the Iranian market, but it now faces stiff competition from Chinese carmakers that have grabbed more business during the sanction years, as well as from western rivals such as Renault, who are also flocking back with newer models. (REUTERS)

Court denies warrant for Lotte chairSEOUL: A South Korean court rejected a request by prose-cutors for a warrant to arrest Lotte Group Chairman Shin Dong-bin in the latest twist in a wide-ranging cor-ruption probe that has convulsed the country’s fifth-larg-est family-run conglomerate. But an investigation that has constricted management since flaring into public in June, derailing plans for billion-dollar deals, will contin-ue. Prosecutors may re-submit their request, a prosecu-tion source said, and warrant or not, Shin could yet face trial - a process that with appeals could last many months. A Seoul Central District Court judge said early on Thursday the arrest warrant request had been turned down after a hearing at which Shin, 61, appeared on Wednesday. The court said it didn’t view Shin’s arrest as necessary. (REUTERS)

Japan firms to merge nuclear unitsTOKYO: Hitachi Ltd , Toshiba Corp and Mitsubishi Heavy Industries Ltd are in final talks to merge their nuclear fuel businesses as early as spring, the Nikkei business daily reported. The merger is expected to keep the nucle-ar operations of these companies afloat, even though most of Japan’s nuclear reactors remain idle, the Japa-nese business daily reported. The integration would let the trio cut costs by streamlining manufacturing bases and other related operations, the Nikkei reported. All the three companies could not be reached for comment. A March 2011 earthquake and tsunami had triggered melt-downs at Tokyo Electric Power Co’s (Tepco) Fukushima Daiichi plant, the worst nuclear disaster since Chernobyl in 1986. The meltdowns in three Fukushima reactors spewed radiation over a wide area of the countryside, contaminating water, food and air. (REUTERS)

Wal-Mart in talks to buy Flipkart stakeNEW DELHI: Wal-Mart Stores Inc is in talks to buy a minority stake in India’s largest e-commerce firm Flipkart, two people familiar with the matter said, as the world’s biggest retailer aims to break into a fast growing but highly competitive online retail market. One of the sources said the US retailer was looking to invest between $750 million and $1 billion in Flipkart, but the final value and size of the stake would depend on the out-come of talks about the Indian company’s overall valua-tion. A deal would pit Wal-Mart against US rival Amazon.com Inc, which has been expanding rapidly in a market that Bank of America Merrill Lynch has forecast will surge to $220 billion in value of goods sold by 2025 from about $11 billion last year. (REUTERS)

ICICI Pru Life makes weak market debutMUMBAI: ICICI Prudential Life Insurance Co Ltd, India’s biggest private-sector life insurer, fell as much as 7.2 per-cent on its market debut on Thursday, as investors fretted over its high valuation and rising competition. The weak debut after a $911 million initial public offering (IPO)—India’s biggest in six years—is nevertheless unlikely to affect an IPO boom this year, analysts and bankers said, due to the company-specific factors influencing the shares. Several more deals in various sectors are planned for later in the year. With generally lower insurance cov-erage than developed markets, India is seen as a bright spot for the industry. That growth potential has attracted many foreign insurers to forge joint ventures. (REUTERS)

bizline

REUTERSSINGAPORE, SEPT 30

The global shipping industry, ravaged by collapsing revenues, defensive mergers and the fail-ure of major player South Kor-ea’s Hanjin Shipping Co Ltd, is slowly waking up to the redeem-ing potential of technology.

While sensor-laden contain-ers, smart ships and 3D printing have grabbed the headlines, the start-ups making the biggest inroads are those working on something more basic—stream-lining the interaction between shippers, freight forwarders, and those actually transporting the goods. “This is way up there on the list of insanely complex systems with enormous impact on the global economy,” says Trae Stephens of Founders Fund, which this week led a $65 million investment round in Flexport, a start-up focusing on

providing logistics services and data. “We believe doing this in a more efficient way can really move the needle on every part of the economy,” said Stephens, who will join Flexport’s board as part of the investment round.

Container ocean trade is like-ly to grow no more than 3 per-cent over the next few years—at a compound annual growth rate—compared to 10 percent in 2000-05, and 5 percent in 2005-10, according to Seabury, a trans-portation consultancy, and McKinsey predicts shipping oversupply will stay above 20 percent this year and next.

Zvi Schreiber, CEO of Freightos, a Hong Kong start-up that offers Expedia-like quotes for end-to-end freight shipping, says the shipping industry is “manual, inefficient and opaque”. KPMG found that a quotation for shipping freight typically involved 20 associated

fees and, according to the Journal of Commerce, shippers each lose up to $150,000 a year when price volatility and staff-ing cuts force invoicing errors.

“This industry is broken, there’s no question we have a serious issue,” Jesper Kjaedegaard, partner at shipping and logistics firm Mercator International, told a

recent shipping conference in Singapore. “Without technology, this industry is not going to move much further.”

Kjaedegaard pointed to start-ups like Xeneta, set up by two industry veterans after they failed to convince their employ-er, shipping giant Kuehne und Nagel (KNIN.S), to introduce greater transparency into rates

charged. “Transparency is viewed by a lot of people in the industry as destructive in that it would negatively affect margins,” said co-founder Thomas Sorbo.

Xeneta’s solution was drawn from the world of consumer start-ups: encourage all those in the industry to contribute rates, creating a crowdsourced data-base of some 17 million con-tracted sea-freight rates around the world. By providing real-time data, shippers can see what they should be paying. “Suddenly (they) can compare their contracts with others and find out if they’re being ripped off,” Sorbo said.

Venture capital interest in the broad supply chain and logistics industry has been growing, at least until last year. In 2015, con-sultancy CB Insights counted more than $1.7 billion of invest-ment in start-ups, triple that in

2014. Another $500 million or so was invested in the first half of this year.

Start-ups range from those trying to Uber-ise the industry to those like Natilus, which plans a Boeing 777-size cargo drone which lands and takes off in water. CEO Aleksey Matyushev envisages a world where the cost of transporting goods by air could do away with a lot of the ocean-bound ship-ping, which accounts for around 98 percent of container freight, according to Seabury.

But, for now, it’s start-ups like Xenetas, nibbling away at the industry’s inefficiencies, that are making waves. Freightos, for example, provides software that allows logistics firms to manage contracts and automate the quotation and sales process. Last month, it bought WebCargoNet, a Spanish net-work of air cargo rates.

Ship shake: Hanjin woes may help float tech, data start-upsr e d e e m I n g p ot e n t I a l o f t ec h

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exotic wheels

n Renault’s new concept car—the Trezor—is displayed on media day at the Paris auto show, in Paris, France, on Friday. REUTERS

Nepse dips 13.53 points as book closure nearsPOST REPORTKATHMANDU, SEPT 30

The Nepal Stock Exchange (Nepse) index dipped 13.53 points over the week on slowed demand due to the book closure declared by listed companies.

The secondary market opened at 1,766.91 points on Sunday and shed 36.27 points when trading closed. On Monday, the Nepse rose 26.46 points and closed at 1,757.1 points.

On Tuesday and Wednesday, the index dropped 3.38 points and 4.62 points respectively.

As the market closed for the week on Thursday, the Nepse inched up 4.28 points to close at 1,753.38 points.

“Except shares that investors expected to provide good returns in the long run, demand for most shares slowed, pulling down the overall index,” said Sharada Nepal, managing director of Sagarmatha Securities.

Along with the Nepse, the sen-sitive index that measures the performance of Group A compa-nies also slipped 2.57 points to 380.26 points.

With the Nepse going downhill, the shares listed on the stock market lost Rs11.94 bil-lion of their value and market capitalisation amounted to Rs1,940.73 billion.

Among the nine trading groups, the indices of seven declined last week. The insurance sub-index witnessed a fall of 281.9 points and closed at 8,701.47 points.

Likewise, the development bank sub-index went down 65.24 points to 1,804.11 points. Hydropower lost 41.98 points, manufacturing lost 38.63 points and the sub-indices of hotels, finance companies and others decreased 18.55 points, 10.87 points and 6.94 points respectively.

Nepal of Sagarmatha Securities described the fall in the insurance sub-group as market correction.

“Stocks of insurance compa-nies are overpriced, and it is natu-ral that the index should fall over time,” she added.

The banking group was the only gainer last week. The index of commercial banks swelled 11.47 points to close at 1,672.73 points. The trading sub-index was stable at 202.79 points.

Last week, Everest Bank observed the biggest turnover of Rs530.12 million. Recording share transactions worth Rs228.66 mil-lion, Nepal Bangladesh Bank came in the second position.

They were followed by National Life Insurance, Siddhartha Bank and Sunrise Bank in terms of turnover.

Stockbroker Nepal attributed the rise in the value of transac-tions of Everest Bank to the return that the bank is scheduled to make in a few days. “As the bank’s book closing time is approaching, investors have great expectations that it will offer a high return.”

In terms of the number of

shares traded, Nabil Balance Fund 1 topped the list with 511,000 shares changing hands.

Last week, the shares of 158 listed companies were traded. Along with a fall in the Nepse, the turnover declined 21.27 percent to Rs4.45 billion. Similarly, the num-ber of shares traded fell to 5,292,160 from 7,239,750 units.

market watch

Vegetables Unit Price (Rs)

Fruits Unit Price (Rs)

Red Potato Kg Rs55

White Potato Kg Rs45

Onion (Indian) Kg Rs35

Tomato Small Kg Rs65

Carrot Kg Rs125

Tomato Big Kg Rs55

Squash Kg Rs55

Cabbage Kg Rs35

Brinjal Long kg Rs65

Cow Pea Kg Rs55

daIly commodItIes

gasolIne watch

bullIon PRICE PER TOLA

SOURCE: FENEGOSIDA

Apple Kg Rs135

Pomegranate Kg Rs235

Jackfruit 1Pc Rs33

Pineapple 1Pc Rs105

Cucumber Kg Rs65

Papaya Kg Rs83

Banana Doz Rs85

Lime 100 Pcs Rs475

Pokhreli Rice Kg Rs70

Jeera Masino Rice Kg Rs70

Indian Basmati Rice Kg Rs100

Mansuli Rice Kg Rs55

Sona Rice Kg Rs50

Beaten Rice (Taichin) Kg Rs130

Beaten Rice Kg Rs60

Big Mas Kg Rs260

Small Mas Kg Rs240

Big Mung Kg Rs180

Musuro (No 1) Kg Rs170

Musuro (No 2) Kg Rs150

Rahar Kg Rs270

Chana (Big) Kg Rs210

Chana (Small) Kg Rs180

Chilli Powder Kg Rs400

Commodities Unit Price (Rs)

Int’l market

Energy Price (US$) %Change

Agriculture Price (US$) %Change

Industrial Metals Price (US$) %Change

COPPER FUTURE (lb) 220.15 0.53

Precious Metals Price (US$) %Change

GOLD 100 OZ FUTR (t oz) 1,330.30 0.32SILVER FUTURE (t oz) 19.62 2.25

COCOA FUTURE (MT) 2,716.00 -0.44COFFEE ‘C’ FUTURE (lb) 153.1 -0.39CORN FUTURE (bu) 326.25 -0.91COTTON NO.2 FUTR (lb) 67.41 -0.47ROUGH RICE (CBOT) (cwt) 9.67 -0.72SOYBEAN FUTURE (bu) 948.00 0.26SOYBEAN MEAL FUTR (T) 300.4 0.33SOYBEAN OIL FUTR (lb) 33.01 0.36SUGAR #11 (WORLD) (lb) 23.78 1.45WHEAT FUTURE(CBT) (bu) 396.75 -0.56

Hallmark Gold Rs58,300

Tejabi Gold Rs58,050

Silver Rs865

RETAIL PRICE

BRENT CRUDE FUTR (bbl) 48.99 -0.51GAS OIL FUT (ICE) (MT) 436.50 4.93GASOLINE RBOB FUT (gal) 146.29 -0.27NATURAL GAS FUTR (MMBtu) 2.94 -0.71

Weekly Stock

Review

Nepse iNdex

seNsitive iNdex

tradiNg amouNt rs iN m

1766.91

1730.64

1749.1

1,056.29

Market capitalisation sunday(opening)

rs1952.67bn thursday(closing)

rs1940.73bn

top 5 coMpanies (trading amount rs in million)

Everest Bank 530.1Nepal Bangladesh Bank 410.5National Life Insurance 228.7Siddhartha Bank 209.8Sunrise Bank 183.1

nepse index 13.53 sensitive index 2.57

1,076.13 752 753.41

thuwedtuesun

1753.381757.1

382.83

375.04

380.96

380.23

379.26

1753.72

sun (opening) thuwedMonsun (closing) tue

sun (opening) thuwedMonsun (closing) tue

380.26

Mon

812.47

With the nepse going downhill, the shares listed on the stock market lost Rs11.94 billion of their value