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Wednesday,27-October-2021

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BPCL bid: Prior security clearance may be required to end Chinese links

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Bharat Petroleum. (Photo: Twitter/@BPCLimited)

The government has decided to get prior security clearance of entities placing a price bid for Bharat Petroleum Corporation Ltd. as it looks to prevent any last leg disruption in the bidding process while eliminating any chance of bidders with even any indirect Chinese linkage from being declared the winner.

Sources privy to the development said security clearance of all bidders before placing the financial bid or simultaneously with the price bids has been made mandatory to weed out unwanted entities and allow only companies or consortiums passing muster, to qualify in the process.

Also, such process would prevent delays in the event a winning candidate fails to get security clearance. In such a scenario, the next best candidate with proper security clearance could be declared the winner if it matches the bid of the disqualified winning candidate.

“Normally, security clearance process follows financial bidding stage after an entity is declared winner on the basis of its price bid. However, for BPCL strategic sale, extra care is being taken to ensure that process is not derailed after an entity is declared winner and company’s valuations comes out in public domain. Earnings from BPCL privatisation would be key to government achieving ambitious disinvestment target of Rs 2.1 lakh crore this year,” said a government official privy to the development.

The queries generated to BPCL preliminary information memorandum (PIM) has seen clarity being sought by prospective bidders over the security clearance process. In its latest clarification issued last week, DIPAM has also said interested parties may have to obtain security clearances while submitting their price bids.

The issue of security clearance privatisation of a company in the strategic energy sector was also discussed in a late last month meeting of the core group of secretaries on disinvestment.

While DIPAM has eased the disinvestment process for bidders allowing them to change the structure of investing company right upto the stage of signing the share purchase agreement, however all such changes would follow proper security scrutiny first.

In the event of a consortium participating in BPCL disinvestment, all entities of the consortium would need to get security clearance. Similarly, if a subsidiary is bidding, security clearance for both patent and subsidiary may be needed.

While the government had already changed the goalpost for investment from countries sharing a border with India as these now need to get the Indian government’s approval first, extra care is being taken for investment in strategic sectors such as oil and gas to prevent entry of entities from hostile nations such as Pakistan and China.

The government has thrown an extra ring around any investment proposal from countries such as China with which its relations have deteriorated after the June clash with Chinese troops in which 20 Indian soldiers were killed. The government has already put restrictions on Chinese presence in the power sector while it has also banned several Chinese apps like Tik Tok, PubG citing security concerns.

The government is selling its entire 52.98 per cent stake in BPCL to a strategic buyer. The PSU’s disinvestment, that could likely fetch close to Rs 50,000 crore to the exchequer, is also seen as a test case for the government’s strategic disinvestment programme.

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Small LPG cylinders, financial services at FPS proposed

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 The Centre on Wednesday proposed to sell small LPG cylinders through Fair Price Shops (FPS) across the country.

There is a proposal to provide financial services through FPS and extending MUDRA loans to its dealers for capital augmentation.

There are a total of 5.32 lakh FPS in the country. With this step, the Centre is aiming at taking its services closer to poorer and needy consumers.

Focussing on enhancing financial viability of FPS, Department of Food and Public Distribution Secretary, Sudhanshu Pandey in a video conference with representatives of multiple ministries and PSUs stressed on the need of taking proactive measures for the same.

The representatives from oil marketing companies appreciated the proposal for retail selling of small LPG cylinders through FPS and informed that “necessary support required would be provided for the same in coordination with interested state or Union Territory (UT) governments,” said a release from the Ministry of Consumer Affairs, Food and Public Distribution in New Delhi.

The representative from the Department of Financial Services appreciated the government’s proposal to provide financial services through FPS, extending MUDRA loans to FPS dealers for capital augmentation and informed that necessary support would be provided for it in coordination with interested state or UT governments.

Earlier, the CEO, Common Service Centre (CSC), gave a presentation about the various service offerings provided by it. An update on the activities undertaken by CSC to tie-up with individual state or UT governments to take this initiative forward was presented, too.

Set up under the Ministry of Electronics and Information Technology, the CSC scheme provides a centralised and collaborative framework for delivery of services to the citizens.

In his concluding remarks, Sudhanshu Pandey mentioned that different states or UTs can take up these initiatives and tailor them to suit their individual requirements.

Representatives from the Ministry of Electronics and Information Technology, Department of Financial Services, Ministry of Petroleum and Natural Gas, Indian Oil Corporation Limited, Bharat Petroleum Corporation Limited, Hindustan Petroleum Corporation Limited, CSC e-Governance Services India Limited and all states/UTs participated in the virtual conference, the release added.

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Google logs record $18.9 bn profit, Search and YouTube soar

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Alphabet, the parent company of Google, has posted an all-time record revenue of $61.9 billion for the July-September quarter, along with record profits at $18.9 billion.

Google Services revenues were $59.9 billion, up 41 per cent, and Google Search and other advertising revenues of $37.9 million in the quarter were up 44 per cent.

The company said in a statement late on Tuesday that YouTube advertising revenues of $7.2 billion were up 43 per cent due to strength in both direct response and brand advertising.

“Our long-term investments in AI and Google Cloud are helping us drive significant improvements in everyone’s digital experience,” said Sundar Pichai, CEO of Alphabet and Google.

“Search remains the heart of what we do. We have made remarkable advances over the past 23 years that benefits Search and related products like Google Assistant, which just celebrated five years,” he added.

For Google Cloud, the revenues were $5 billion for the third quarter, up 45 per cent.

“Google Cloud Platform’s (GCP) revenue growth was again above cloud overall, reflecting significant growth in both infrastructure and platform services,” said Ruth Porat, Senior Vice President and Chief Financial Officer.

At the Alphabet level, headcount grew by nearly 6,000 in the third quarter, including seasonal campus hires.

“We expect robust headcount growth in Q4 for both Google Services and Google Cloud,” the company said.

Alphabet said that with respect to foreign exchange impact on reported revenues, it expects virtually no impact in Q4 in contrast to a 1.5 per cent tailwind in Q3 and 4 per cent in its Q2.

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Petrol, diesel rates raised again by 35 paise/ltr

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Petrol and diesel prices increased again on Wednesday after a two-day break as global oil prices failed to relent and continued to remain firm.

Accordingly, the pump price of petrol in Delhi increased by 35 paise per litre to jump to Rs 107.94 a litre while diesel prices also increased by the same margin to reach Rs 96.67 a litre, according to a price notification of state-owned fuel retailers.

In the financial capital Mumbai, petrol prices have now risen to Rs 113.80 per litre while diesel to Rs 104.8 5 a litre, the highest among all metros.

Across the country as well petrol and diesel prices increased between 35-40 paise per litre, but their retail rates varied depending on the level of local taxes on petroleum products.

The fuel prices remained static last week on Monday and Tuesday, but had risen for four straight days by 35 paise per litre previously before again rising for five consecutive days between Wednesday and Sunday. It remained static again on Monday and Tuesday before rising again on Wednesday. There was no change in rates on October 12 and 13.

Diesel prices have now increased for 25 of the last 33 days taking up its retail price by Rs 8.15 per litre in Delhi.

With diesel prices rising sharply, the fuel is now available at over Rs 100 a litre in several parts of the country. This dubious distinction was earlier available to petrol that had crossed Rs 100 a litre-mark across the country a few months earlier.

Petrol prices had maintained stability since September 5, but oil companies finally raised the pump prices last week and this week given a spurt in the product prices lately. Petrol prices have also risen on 22 of the previous 29 days taking up its pump price by Rs 6.75 per litre.

Crude prices have been on a surge rising over three year high level of over $ 86 a barrel now as global demand remains firm while OPEC+ continues to move slowly on increasing production. Since September 5, when both petrol and diesel prices were revised, the price of petrol and diesel in the international market is higher by around $9-10 per barrel as compared to average prices during August.

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