LSE listing for Indian firms soon The government will explore direct overseas listing of Indian firms on the London Stock Exchange (LSE) only after a plan for overseas listing of domestic firms in the GIFT International Financial Services Centre (IFSC) in Gujarat is implemented, finance minister Nirmala Sitharaman said on Monday. The minister’s comments came during the meet with the UK Chancellor of the Exchequer Jeremy Hunt at the 12th annual India-UK Economic Financial Dialogue here on Monday. Hunt earlier said: “We are particularly pleased to have made a big step forward with the first confirmation by India that it will explore the LSE as an international destination for the direct listing of Indian companies.” Cross-border listing is expected to help Indian firms gain access to a larger base of investors, and attune their corporate governance standards to the best global practices. Manmeet Kaur, Principal Associate, Karanjawala & Co, said: “… the move to consider LSE as one of the international destinations for direct listing of Indian firms will open new avenues for Indian entities, such as better access to international markets and access to a larger base of investors, among others.” Sitharaman said the UK has expressed willingness to further expand its footprint in the Gift City IFSC and foster a robust fintech partnership. The International Financial Services Centres Authority (IFSCA), the regulator for IFSCs, is looking to operationalise the framework for direct listing of companies on IFSC exchanges by end-2023. In July, Sitharaman had announced direct listing of Indian companies in GIFT IFSC. An Indian firm listing on the bourses in IFSC is comparable to listing on an international exchange like the New York Stock Exchange or the LSE. Currently, Indian companies are not allowed to list directly on overseas exchanges as per regulations. However, listed Indian companies can use American Depository Receipts (ADR) or Global Depository Receipts (GDR) to make their shares accessible to overseas investors or list debt instruments on overseas exchanges. Overseas listing treatment to firms listing in GIFT IFSC would help the Indian firms take advantage of lenient tax rules for the offshore facility. The IFSC is being groomed by the government to make it an international financial hub on the lines of London that could act as a catalyst in attracting foreign investors to Indian corporates which are gaining global prominence and need a large pool of capital from the worldwide. Both Hunt and Sitharaman said their countries are trying to expedite discussions that would lead to signing the Free Trade Agreement (FTA) and Bilateral Investment Treaty (BIT) as soon as possible. “We can really support each other’s plans to strengthen the relationship and the way the next step of this is a comprehensive FTA and Bilateral Investment Treaty,” Hunt said. The much-awaited trade and investment pact with the UK looked to face further delays, going by the statements of Prime Minister Narendra Modi and British prime minister Rishi Sunak after their bilateral meeting on the sidelines of G20 here. Sunak said he was confident a deal with India could be secured but cautioned “there was still hard work to do.” Investment agreement, rules of origin and intellectual property rights are some of the issues that are proving to be contentious ones in the negotiations. From the Indian side, the demand for easier visas for professionals is seeing some resistance from the UK. “Today, we have also launched the UK India Infrastructure Financing Bridge. It is a collaborative venture co-led by the Niti Aayog and the City of London Corporation for harnessing collective expertise in planning and implementing major infrastructure projects,” she said. Hunt said even though London is the world’s second largest financial services centre, majority of asset managers there don’t invest in India. “So there is a huge opportunity, we are looking at changes to the way our pension and insurance funds regulated because there is a strong desire on their part to invest more in productive assets and we have huge pool of capital that are ready to be harnessed,” Hunt said.
Retail inflation in milk was reported at 8.85% in May 2023. The milk inflation has remained elevated at over 6% since August 2022. Despite India being the largest milk producer since 1998, the commodity has been the second biggest factor after cereals such as rice and wheat in driving up retail inflation in the last fiscal.
Milk has the second highest weight in the food and beverages basket of the consumer price index at 6.61%, a notch lower than cereals and products with a 9.67% weight. Organised players, including Mother Dairy and Amul, hiked prices multiple times in the last one year citing higher fodder cost, robust demand and some impact due to reports of lumpy skin disease.
Industry sources said feed cost, which has a share of more than 65% in the cost of production of milk, has increased to Rs 20/kg from Rs 8 a year ago. The finance ministry in April had attributed the elevated milk inflation to a demand supply mismatch and said it could be one of the factors apart from volatile international crude oil prices and constrained supplies of milk would influence the country’s inflation trajectory.
“Milk production has been impacted by a lumpy skin disease infecting millions of cattle in late 2022,” the ministry said in the monthly economic review, adding that the vaccination drive against the disease is expected to curb the spread and immune the cattle against the skin disease.
According to official data, currently India is the world’s largest milk producer, and has a share of 23% in global milk production. For the first time in decades, the country’s milk production is likely to have stagnated in 2022-23 due to Lumpy Skin Disease in cattle across several states and the lagged effect of Covid-19 in the form of stunting of the animals, a senior official with department of animal husbandry and dairying recently had stated. The milk production was estimated at 221 million tonne in 2021-22.