Japan says won’t sign RCEP Sebi to rule on Karvy breather by Mon if India doesn’t join the pact
INDIA WITHDREW FROM RCEP THIS MONTH, CITING THE DEAL’S POTENTIAL IMPACT ON LIVELIHOODS OF MOST VULNERABLE CITIZENS
SAT HAS ASKED SEBI TO DECIDE ON INTERIM RELIEF FOR KARVY AND ALLOW LIMITED USE OF ITS RIGHTS UNDER POWER OF ATTORNEY
TOKYO: Japan is not considering signing a Chinese-backed regional trade pact without India, the top Japanese negotiator said on Friday, ahead of a series of diplomatic exchanges in the coming weeks that include a visit to Delhi by Prime Minister Shinzo Abe.
India announced this month it was withdrawing from the Regional Comprehensive Economic Partnership (RCEP), citing the deal’s potential impact on the livelihoods of its most vulnerable citizens.
China said that the 15 remaining countries decided to move forward first and India was welcome to join RCEP whenever it’s ready.
“We aren’t thinking about that at all yet,” deputy minister for economy, trade and industry Hideki Makihara, said in an interview with Bloomberg. “All we are thinking of is negotiations including India.”
Abe has sought to beef up ties with India across a range of fields to balance China’s regional dominance. Japanese and Indian foreign and defence ministers hold their first joint meeting in a so-called “two plus two” format this weekend. Both countries are also part of fourway security talks with Australia and the US called the Quad, a move that Beijing has complained could stoke a new Cold War.
“It is meaningful from the economic, political and potentially the national security point of view,” Makihara said of the inclusion of the world’s largest democracy in the pact. “Japan will continue to try to persuade India to join.”
Trade minister Hiroshi Kajiyama will accompany Abe on next month’s trip to India, Makihara said.
The other countries taking part in the RCEP talks are Australia, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, New Zealand, Philippines, Singapore, South Korea, Thailand and Vietnam.
China has sought to accelerate the RCEP deal as it faces slowing growth from a trade war with the US. An agreement would further integrate Asia’s economies with China just as President Donald Trump’s administration urges nations in the region to shun Chinese infrastructure loans and 5G telecommunications technology.
MUMBAI: The Securities Appellate Tribunal (SAT) on Friday asked the Securities and Exchange Board of India (Sebi) to decide on interim relief for Karvy Stock Broking Ltd, and allow limited use of its rights under power of attorney by Monday.
In its November 22 order, Sebi had barred Karvy from using power of attorney after the broker allegedly transferred clients’ money for other purposes and indulged in trade not authorized by them.
A power of attorney in trading is given by clients to a broking firm to trade on their behalf.
This gives the broking firm control over the clients’ securities—to move them freely in and out of the clients’ or investors’ demat account.
As per the Sebi order, Karvy misused client securities by pledging them with various lenders without authorization. The total value of these transactions is estimated to be ₹2,000 crore, making it one of the largest defaults by a stockbroker in India. Some of the securities were transferred, sold off and proceeds transferred towards Karvy’s own real estate business, Karvy Realty Ltd.
The brokerage had filed a petition with SAT seeking relief from some of the restrictions imposed by Sebi, saying they were making it difficult for it to honour client payout requests.
Karvy made these representations to Sebi through three letters on November 24, 25 and 26. It then approached the tribunal when the market regulator did not reply to its representations.
Karvy also contended in its plea on Friday, a copy of which has been reviewed by Mint, that due to these restrictions it has not been able to honour the requests of 2,000 clients, which led a loss of ₹8 crore in the past one week.
“The revocation of power of attorney is creating problems for Karvy in settling trades. Since clarification is sought, we deem it fit and proper that Sebi looks into the matter by giving Karvy an opportunity of hearing and passing final orders by Monday,” the SAT directed Sebi.
Senior counsel Rafique Dada, appearing on behalf of Sebi, said the misuse could be larger than the original estimates as per the initial findings of a forensic audit by Sebi. “It pertains to total misuse of power of attorney for pledging of client shares. Securities in client demat account are being misused as well as securities from pool account are being transferred to brokerage’s own account.”
He added that the market regulator has serious apprehensions about allowing the prayer of the appellant as it might lead to further misuse of the power of attorney given to it by its clients
A Mint story on November 29 said Karvy is facing challenges in honouring requests of nearly 95,000 clients.