Indian markets regulator aims for fewer related-party deals being reported, needing investor nod
These proposals are part of the Securities and Exchange Board of India's (SEBI) relook at the required disclosures on labour, environment and other issues as it seeks "optimal regulations" under recently appointed chairman, Tuhin Kanta Pandey.
The regulator has now proposed that companies no longer need to disclose related-party transactions that have a value of less than 150 million rupees (about $1.70 million).
While they will still have to report transactions above this value, it has proposed a revenue-based graded approach to determine which of these deals will require approval from minority shareholders.
For instance, a company with an annual turnover of more than 300 billion rupees will need shareholder clearance for a related-party transaction worth more than 25 billion rupees ($285 million).
However, shareholders would need to clear every related-party transaction worth more than 50 billion rupees (about $570 million). That threshold, though, is five times higher than the current one of 10 billion rupees.
This increase would have meant 60% of the related-party deals among the top 100 listed firms on the National Stock Exchange in the last two fiscal years would not have needed shareholder approval, according to the SEBI's calculations.
"This will ease compliance burden on listed entities, give some flexibility and reduce timelines for related-party transactions," said Lalit Kumar, partner at J Sagar Associates.
He said this approach is departure from the previous SEBI regime when rules around related-party transactions were 'only tightened' and disclosure requirements were increased.
Since taking over as SEBI chairman in March, Pandey has sought to dial back the disclosure requirements, and opt for "honest" disclosures.
($1 = 87.6090 Indian rupees)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
19 minutes ago
- Reuters
Country Garden's liquidation hearing adjourned to January 5
HONG KONG, Aug 7 (Reuters) - Chinese property developer Country Garden ( opens new tab confirmed on Thursday that the Hong Kong High Court had adjourned a hearing into a liquidation petition against it to January 5, 2026. The adjournment was earlier posted on the Hong Kong judiciary's website. The hearing was originally scheduled for August 11, 2025. Once a top developer by sales in the country, Country Garden defaulted on its offshore debt in late 2023 and is now trying to gain lenders' support on its restructuring proposal that aims to cut $14.1 billion of that debt by 78%. Getting enough creditor support on the restructuring proposal is essential for Country Garden to convince the court to reject the petition, which was filed last year by Ever Credit, a unit of Hong Kong-listed Kingboard ( opens new tab.
Reuters
19 minutes ago
- Reuters
Trump tariffs hit India's garment makers as US buyers say move production
MUMBAI/CHENNAI, Aug 7 (Reuters) - Ever since Donald Trump's tariff salvo on India this week, garment maker Pearl Global - whose U.S. client list includes Gap and Kohl's - has been receiving midnight panic calls with an ultimatum: share the tariff hit or move production out of India. To calm U.S. customers' nerves, Pearl Global ( opens new tab has offered to shift production to its 17 factories in Bangladesh, Indonesia, Vietnam and Guatemala to bypass the steep U.S. levies on Indian imports. "All the customers are already calling me. They want us to ... shift from India to the other countries," Managing Director Pallab Banerjee told Reuters in an interview. Trump's initial tariff proposals in April - which were lower for India than for the rival Asian garment hubs of Bangladesh, Vietnam and China - had been seen as an opportunity for India to rapidly expand in the $16 billion apparel exports market. But the tables have turned as relations between New Delhi and Washington have soured, with India now facing a 50% tariff, versus 20% for Bangladesh and Vietnam, and 30% for China. Pearl gets roughly half of its business from the United States. Some clients offered to continue taking products from India if it could share the tariff burden, but that is not viable, Banerjee said, without naming the customers. The 50% U.S. tariff - comprising 25% that kicked in on Thursday and another 25% due to come into force on August 28 as a penalty for buying Russian oil - has stunned U.S. garment buyers and their Indian suppliers, who say they are considering taking their manufacturing operations beyond Indian shores, even to less-established garment hubs like Ethiopia and Nepal. Some exporters also say they have been asked by U.S. clients to put orders on hold. New Delhi has called Trump tariffs "extremely unfortunate". India's garment sector was already grappling with a labour crunch and limited production capacity. But the prospect of exporters shifting production outside India would also be a blow to Prime Minister Narendra Modi's "Make in India" policy drive. While Pearl can use its foreign factories to meet U.S. orders, exporters that rely on domestic factories are set to be hit much harder. RichaCo Exports has shipped $111 million of garments to the U.S. this year, with clients such as J. Crew Group, customs data shows. All were made in its more than two dozen factories across India. Around 95% of its annual Indian revenues come from the United States, said general manager Dinesh Raheja. "We're exploring setting up a manufacturing base in (Nepal's capital) Kathmandu," he said. "The industry is in the doldrums." Earlier this week, India's biggest jeweller and watchmaker Titan ( opens new tab told Reuters it was looking at shifting some manufacturing to the Middle East to maintain low-tariff access to U.S. markets. Amit Agarwal, finance chief of top Indian garment maker Raymond, said he was pinning hopes on the company's one factory in Ethiopia - which faces just a 10% U.S. tariff and could possibly add more production lines within three months to cater to U.S. clients. The tariff threat comes as India was emerging as a big alternative for U.S. garment buyers like Walmart (WMT.N), opens new tab, as Bangladesh faces a political crisis, and companies look to diversify supply chains beyond China. Indian garment hub Tiruppur in the south, considered the country's knitwear capital and which accounts for nearly one-third of apparel exports, was bullish about the future earlier this year when Reuters visited and talked to exporters. Panic has now descended on the hub. Some factories in Tiruppur have been asked by customers to hold orders, while some plan to ship as many goods as possible before the full 50% tariff kicks in, said Naveen Micheal John, executive director at Cotton Blossom India. "An importer, which had placed orders for underwear, has come back saying that if you haven't purchased yarns ... keep it on hold for now," he said. Some garments in Tiruppur cost U.S. clients as little as $1, while a women's or men's T-shirt can vary from about $3.5-$5, which could soon face 50% tariffs, said N. Thirukkumaran, general secretary of the Tiruppur Exporters Association.
BBC News
an hour ago
- BBC News
Japan's population falling with 900,000 more deaths than births in 2024
Almost a million more deaths than births were recorded in Japan last year, representing the steepest annual population decline since government surveys began in Minister Shigeru Ishiba has described the demographic crisis of Japan's ageing population as a "quiet emergency", pledging family-friendly policies such as free childcare and more flexible work hours. But efforts to reverse the perennially low birth rates among Japanese women have so far made little data released on Wednesday by the Ministry of Internal Affairs and Communications showed the number of Japanese nationals fell by 908,574 in 2024. Japan recorded 686,061 births - the lowest number since records began in 1899 - while nearly 1.6 million people died, meaning for every baby born, more than two people marks the 16th consecutive year of population decline with the squeeze being felt by the nation's pension and healthcare number of foreign residents reached a record high of 3.6 million people as of 1 January 2025, however, representing nearly 3% of Japan's government has tentatively embraced foreign labour by launching a digital nomad visa and upskilling initiatives, but immigration remains politically fraught in the largely conservative country. The overall population of the country declined by 0.44 percent from 2023 to about 124.3 million at the start of the people aged 65 and over now make up nearly 30% of the population - the second-highest proportion in the world after Monaco, according to the World Bank. The working-age population, defined as those between 15 and 64, has dropped to about 60%.A growing number of towns and villages are hollowing out, with nearly four million homes abandoned over the past two decades, government data released last year government has spent years trying to increase birth rates with incentives ranging from housing subsidies to paid parental leave. But deep-rooted cultural and economic barriers living costs, stagnant wages and a rigid work culture deter many young people from starting families. Women, in particular, face entrenched gender roles that often leave them with limited support as primary fertility rate - the average number of children born to a woman over her lifetime - has been low since the 1970s, so experts warn even dramatic improvements now would take decades to bear fruit.
