Over half of Russian oil exports to India this fiscal; Russian crude economical for Indian refiners despite lowering discounts Indian refiners have bought over half of the oil exported by Russia so far in the current fiscal year, vying with firms from a handful of other countries that remained keen to buy the heavy sour oil, despite the western sanctions. According to energy cargo tracker Vortexa, till mid-August this fiscal, India imported 1.77 million barrels per day (mbpd) of the total 3.53 mbpd of oil Russia exported, thanks to the deep discounts. The balance 11% was imported by countries including Turkey and Bulgaria. Pakistan, which imported two consignments of Russian crude oil last June, stopped the trade on the grounds of the quality of crude coming from Russia. India, which had less than 2% of crude oil import from Russia before the G7 advanced economies imposed sanctions on Russia after it invaded Ukraine in February 2022, increased its crude oil import from Russia to a maximum of 42% in July. However, with the 500,000 barrels per day cut in oil exports by Russia since the start of August has led to a 27% decline for India over the previous month. India imported 1.4 mbpd of oil in the first half of August as against 1.9 mbpd in the month of July. India’s import was still the highest at 46% of the total Russian oil export made in August, followed by China accounting for another 40%. Analysts believe India and China will continue to import more than 80% of the Russian crude in the foreseeable future. “Lot of countries under the pressure of the G7 and the US are not purchasing Russian crude. More than 80% of the Russian oil has been coming to India and China,” said Prashant Vasisht, vice president and co-head of corporate ratings at ICRA. Russian suppliers, however, have started lowering the discounts particularly after the announcement of production cut by OPEC countries and Russia’s own decision to cut down exports to jack up the oil price, which was down for two months since mid-April. “Discounts have reduced, but not so much to make it a weak proposition because the quantities are so huge that even some discount will lead to huge savings,” Vasisht said, adding that there may not be further lowering of Russian oil import this year.
Kotak Mahindra Capital Company Ltd, ICICI Securities Ltd and JP Morgan India Pvt Ltd are the book running lead managers to the issue.
The equity shares of Blue Jet Healthcare are proposed to be listed on the BSE and the NSE.
Also read: Petrol and Diesel Rate Today, 11 February: Fuel prices steady; Check rates in Delhi, Mumbai, other cities
In its consultation paper, Sebi has suggested that trustees of mutual funds should focus on market abuse by AMC, its employees and mis-selling by the AMC to increase the asset base.
Also, trustees should be responsible for fairness of fees and expenses charged by the AMC, compare its performance with peers and ensure that AMC’s sponsor is not getting any undue advantage.
In addition to the core areas, the trustees should be responsible for periodically reviewing the steps taken by AMCs for the folios which do not contain all KYC attributes with bank details.
Further, Sebi has suggested that trustees and their resource persons should independently evaluate the extent of compliance by AMC and not merely rely on AMC’s assurances.
To facilitate trustees’ supervision, AMCs should provide them with analytical information.
Presently, the trustees primarily rely on the AMCs for ensuring compliance with the applicable rules.
Under the rules, trustees hold the property of the mutual fund in trust for the benefit of the unitholders. The trustees appoint an AMC to float schemes for the mutual fund and manage the funds mobilised under various schemes, in accordance with the investment objectives.
“In view of the increasing scale and reach of the mutual fund industry, trustees’ role in respect of unitholders’ protection assumes even greater significance,” Sebi said on Friday.
Also read: Adani shares continue fall amid MSCI review
Over the past decade there has been a five-fold increase in the size of the mutual fund industry. The assets under management (AUM) has surged from Rs 7.93 lakh crore in November 2012 to Rs 39.89 lakh crore in December 2022.
To ensure that trustees devote time and attention to their core responsibilities, Sebi has suggested that for fulfilling other responsibilities, trustees may rely on professional firms such as audit firms, legal firms, merchant bankers for carrying out due diligence on their behalf.
The Sebi also listed some duties trustees can delegate to AMCs. This include ensuring that all systems are in place prior to the launch of any scheme by the AMC, and calculating any income in the mutual fund due to the fund and any income received in the mutual fund for unitholders.
The regulator has proposed to provide a one year time to existing trustees with board of trustee structure to convert into a trustee company, from governance point of view.
Presently, two structures for trustees are permitted — corporate and board of trustees structure. Moreover, there are a few mutual funds which have the board of trustees structure while the trustees of all other mutual funds have adopted the structure of a trustee company.
Considering the enhanced role of trustees over the period of time, Sebi has suggested to increase the minimum number of trustees to adequately perform their functions. Presently, the minimum number of trustees prescribed is four.
Also, it has been proposed that the chairperson of the trustee company should be an independent director.
Sebi has suggested that apart from the meeting of the audit committee of AMCs and trustees (which mostly comprises of independent directors), the board of AMCs and the board of trustees may be mandated to meet at least once a year to discuss the issues concerning the mutual funds.
The regulator proposed that the existing MF Regulations on AMC and its obligations may be amended to include additional clauses with respect to the obligations of the board of AMC.
The proposed amendment may include a clause which casts an obligation on the board of AMC to ensure that all the activities of the asset management company are in accordance with the provisions of these regulations.
The Securities and Exchange Board of India (Sebi) has sought comments from public till February 24 on these proposals.