Arcelor challenges Guj. govt, Essar Group
'Quest for Restoring Financial Stability in India.' It "would mean regressing to errors of the 1970s and 1980s."
Acharya, who resigned last year after raising concerns about the central bank's independence and the health of state-run banks, was referring to experience of the past when the RBI's monetisation of government debt led to a spike in consumer prices and a balance of payments crisis.
While the Fiscal Responsibility and Budget Management Act prevents the central bank from buying bonds directly from the government in the primary market, calls have been growing to get the RBI to directly buy the sovereign's debt using a provision in the law that allows such an action in the event of the country facing a national calamity or a severe slowdown.
With the Covid outbreak presenting that opportunity, Acharya said this could lead to financial repression in the economy. It could also fan India's twin deficits-—fiscal and current-account gaps—leading to a loss in investor confidence.
"Such risk has materialised unexpectedly at least once a decade over the past 30 years with several minor hiccups in between. History tells us that we ignore this risk at our own peril," he wrote.
—Bloomberg
Ahmedabad, July 26: ArcelorMittal Nippon Steel India Ltd (AMNSIL) has filed a petition in the Gujarat High Court against the Government of Gujarat and Essar Bulk Terminal Ltd seeking transfer of Hazira port licence in its name.
Within days of acquiring Essar Steel under an insolvency process, AMNSIL had made an application to the Gujarat Maritime Board requesting that the licence be transferred to it.
While the government is yet to decide on the matter, the firm has approached the court stating that the Essar Bulk Terminal Ltd (EBTL) holds captive licence as a nominee or trustee, according to the petition filed under Article 226.
ArcelorMittal did not respond to requests for comments.
Essar Steel owns a 10 million tonnes per annum steel plant at Hazira in Gujarat, which is serviced by a captive jetty constructed at the port.
"The petitioner is seeking the reversion of the captive jetty licences,"
AMNSIL said in its petition, claiming it was a captive user of the jetty and the intended beneficiary under all the licences and expansions.
"EBTL is not an independent licensee... but merely a 'nominee' and 'trustee', holding the two licences on behalf of and in trust for petitioner's exclusive use and benefit," it said, adding Essar Steel has ceased to be same group companies and therefore EBTL no longer stands eligible and does not possess any right as a license holder of the captive jetty.
Essar Bulk Terminal Limited has denied this stating that it is an independent company and there exists no nominee or trustee relationship between the companies.
In the Supreme Court approved resolution plan submitted by ArcelorMittal for Essar Steel under the IBC, ArcelorMittal had asked for directions to be given to the Gujarat Maritime Board and Essar Bulk Terminal Ltd asking them to continue the port services at Hazira. —PTI