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Apollo Tyres to cut 750 jobs at Netherlands plant
Apollo Vredestein BV (AVBV) had a meeting with its employees to discuss the future of the plant in Enschede and the company's plans to build a more sustainable business in the Netherlands, Apollo Tyres said in a statement.
PTI@moneycontrolcom








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Apollo Tyres on March 5 said it will cut 750 jobs at its plant in the Netherlands over a period of two years in order to have a "sustainable business" and focus on producing only high-value tyres. The home-grown tyre major had acquired Vredestein Banden BV (VBBV) for an undisclosed sum in 2009 from Russia's bankrupt largest tyre manufacturer Amtel-Vredestein NV.
Apollo Vredestein BV (AVBV) had a meeting with its employees to discuss the future of the plant in Enschede and the company's plans to build a more sustainable business in the Netherlands, Apollo Tyres said in a statement.
AVBV intends to specialise the production in Enschede to a level where only high-performance Vredestein tyres will be produced at a profitable level, it added.
"Aligning the plant to the intended specialised and sustainable production level, will unfortunately result in AVBV having to reduce its workforce in the Netherlands by around 750 full-time employees, over a period of 24 months," Apollo Tyres said.


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Explaining the rationale behind the step, the company said: "Within the current operating environment certain tyre sizes can no longer continue being produced in Enschede at a sustainable and competitive level. The company therefore intends to specialise the plant towards high-value tyres and to secure a sustainable future in the Netherlands."
"The operating environment for AVBV and the entire tyre industry has changed significantly over the last few years," Apollo Vredestein President Benoit Rivallantof said.
Despite large investments made in recent years in modernising the plant, the factory employees' dedication and continuous efforts to make the site economically viable has proved ineffective against the accelerated market transformation and has required a strategic adaption of the site to secure it has a sustainable future in the long run, he added.
"After a deep analysis of the profitability and sustainability of the products currently produced in the Enschede Plant, we regrettably could not arrive at a different conclusion," Rivallantof said.
The company is aware that its employees and their families will face a great deal of uncertainty as a result of this difficult decision, he added.
"As a responsible employer we will comply with all statutory obligations towards our employees. We will regularly inform our employees about developments within this process and offer them all necessary support and assistance," Rivallantof said.
The strategic aim is to specialise the Enschede plant to an extent where AVBV will only produce agricultural tyres and high value niche segment passenger car tyres with a short production run, the tyre maker said.
The plant in Enschede will become the centre of excellence for quality, innovation and production agility, it added.

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First Published on Mar 5, 2020 09:30 pm


Apollo Tyres to cut 750 jobs at Netherlands plant
 

adsatinder

explorer
Modi govt’s record disinvestment target of Rs 2.1 lakh crore faces major challenges

Modi govt needs the money from disinvestment to plug a budget hole and fund spending on infrastructure and reforms.

VRISHTI BENIWAL 6 March, 2020 9:18 am IST
https://www.facebook.com/sharer.php?u=https%3A%2F%2Ftheprint.in%2Feconomy%2Fmodi-govts-record-disinvestment-target-of-rs-2-1-lakh-crore-faces-major-challenges%2F376498%2F

PM Narendra Modi leaving to receive Gotabaya Rajapaksa at Hyderabad House



File photo | PM Narendra Modi leaving to receive Gotabaya Rajapaksa at Hyderabad House | Photo: Praveen Jain | ThePrint



New Delhi: After years of small divestments, Prime Minister Narendra Modi has launched India’s biggest-ever asset sale, a $29 billion privatization drive that would help prop up the economy but could also spark worker protests as some of the nation’s corporate icons go on the block.
Faced with the highest unemployment in 45 years and a shadow-banking crisis that’s crippling lending, Modi needs the money to plug a budget hole and fund spending on infrastructure and reforms. But the plan has roused a storm of protest, even among some of his supporters, over how far he will pursue a policy that could jeopardize millions of livelihoods and dismantle entities that have been a source of pride for citizens in the decades since independence.

“The breadth of the sale program is intended to signal that it is driven by the government’s reformist tendencies rather than just fiscal needs,” said Eswar Prasad, a professor at Cornell University. “A key question is whether Modi is willing to use some of his political capital to push through the privatization and related reforms” to the financial system, labor markets and infrastructure, Prasad said.
Privatization policies the world over have always drawn criticism of “selling the family silver,” but since former British Prime Minister Margaret Thatcher’s historic divestment campaign in the 1980s, governments have defended the strategy as one which brings efficiency and longer-term growth.
Modi’s program likewise has elicited a chorus of disapproval. Affiliates of his Bharatiya Janata Party have labeled it a handover of state assets to “multinational corporations at throwaway prices.”
“The difference is that Thatcher had a comprehensive plan that she backed with income tax, sales tax and so many other things,” said Subramanian Swamy, a lawmaker from the ruling party who has recently been critical of the government’s economic policy. “It was a package to move the country from left to right. Here, there is no comprehensive plan. It’s a horrendous mixture of state control and privatization.”

Missed Deadlines
There are also concerns over whether the plan is even achievable. In the 2019-2020 fiscal year, the government has fallen short of its divestment target after failing to complete the sale of Air India Ltd. and Bharat Petroleum Corp., a state-owned oil refiner. Having missed its fiscal gap goals for a third straight year, those sales have been carried forward.

In all, the federal government aims to sell stakes in more than two dozen of about 300 state enterprises in the next fiscal year starting April 1. So far, Modi’s reforms to businesses include a steep cut in corporate taxes, the merger of some state-owned lenders and measures to encourage more foreign investment.
If the sales do go according to plan in the upcoming fiscal year, they would bring in almost half the amount India has raised from as many as 283 transactions over the past three decades, stock exchange data show. They would also raise the share of divestment receipts to 7% of government revenue, from a little over 2% five years ago.
The big ticket for the coming year is Life Insurance Corp. of India, or LIC, which is expected to rake in as much as 900 billion rupees for only a sliver of the state behemoth. Investors likened the proposal to the record initial share sale of Saudi Aramco, which in December raised more than $25 billion.
The Mumbai-based insurer has more than a million agents and 300 million policies, together with stakes in hundreds of other companies, including its affiliate IDBI Bank Ltd. and the nation’s largest listed company Reliance Industries Ltd. But LIC is much more than that to many Indians. It’s a symbol of government support since it was formed in the decade after independence to provide universal coverage.
“Why should there be an IPO? This is public money,” said Shiva Nimje, 52, who has worked for the insurer for 27 years and is part of a campaign by workers to derail the plan. “I’m confident we will be able to stop the sale, however hard we need to struggle for this,” he said by phone from the central Indian city of Nagpur.

National Protest
Rajesh Nimbalkar, general secretary of the All India National Life Insurance Employees Federation, the union that represents many LIC workers, said 100,000 of the firm’s employees are protesting. “LIC is a goose that lays golden eggs,” he said. “The government shouldn’t kill it.”
Even without the staff opposition, LIC’s history, size and operations mean the listing won’t be easy, said Mahesh Patil, chief investment officer for equity at Aditya Birla Mutual Fund.
“LIC being the largest life insurance play will no doubt have interest from investors,” he said. “However, they will have to get over a lot of issues like getting their accounts in order, more disclosures in line with listed players, and employee resistance before they can hit the market.”
While LIC is the elephant in the room, its offering would be a minority stake, not a privatization. The companies where the government is selling control — including Shipping Corp. of India Ltd., the nation’s largest sea-cargo carrier, construction equipment maker BEML Ltd. and Container Corp. of India Ltd. — are a mixed bag from an investment point of view.
Bharat Petroleum, for example, earned a little over 76 billion rupees last fiscal year, while Air India lost almost as much in the same time and hasn’t made money since 2007. The sale plan also comes against the backdrop of the coronavirus epidemic, which is hammering global confidence. India’s benchmark index lost 7% last week.
Junior Finance Minister Anurag Thakur told lawmakers on Dec. 3 that the divestment strategy is guided by the principle that the state withdraw from sectors where competitive markets have matured, and that profitability is not a criteria.

Air India
India has injected $4.2 billion into Air India since a 2012 bailout, yet the airline still has $8.4 billion in debt and continues to lose money.
“The government has tried for many years to turn the company around, but it hasn’t been able to do this,” said Joshua Felman, a director at JH Consulting and a former International Monetary Fund official.
He said government subsidies that allowed Air India to offer lower fares were among the reasons rival Jet Airways India Ltd. was not able to compete. Jet went into bankruptcy last year leaving more than 20,000 people jobless.
The government expects to complete the $7.4 billion sale of its stake in Bharat Petroleum by September, with some big Middle East oil producers and Russia’s Rosneft PJSC, keen to acquire the asset, according to Indian officials.
Skeptics say the sales could have unitended consequences — that losing control of Shipping Corp. would affect the nation’s oil supply and listing LIC could make its investments riskier.
Modi’s political opposition has been more forceful.
“These companies were set up by founding fathers of the country to give employment to people who didn’t have work,” said Ashok Singh, national vice president of the Indian National Trade Union Congress, the union wing of the main opposition party. “Now unemployment is rising and the economy has gone into the intensive care unit. In winter you keep a blanket to keep yourself secure and warm. You don’t give it away.”

Government Perks
That idea of the state’s duty to protect citizens goes to the heart of the opposition from employees. In India, working for the government isn’t just a job. Often it carries prestige and benefits such as job security, better health care, a retirement package, even housing. Each year, millions of people apply for government jobs for which they are clearly overqualified.
“State companies provide a decent employment in terms of promotions, annual increments and wages,” said Brijesh Upadhyay, general secretary of Bharatiya Mazdoor Sangh, a trade union connected with the BJP. “After privatization conditions will change for employees and the company taking over may cut jobs.”
The government argued in a Parliament reply on Feb. 11 that companies released from state control would generate higher economic activity, spur ancillary industries and create jobs. Its recent Economic Survey said research showed a “very strong positive effect” on labor productivity and overall efficiency.
Modi has four years to prove that’s the case before the country will judge the success of the program at the polls.- Bloomberg




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cat

Senior Billi
^^^Good. I get S. Swamy's point and the point about Thatcher government having a good plan, but still, the basic concept is good. Especially Air India, like they say "government should not be in the business of airlines." It is nonsense, nowadays, a very outdated concept. People need to understand, very few national airlines now are SOE. You can have the national brand without it being a SOE. Like British Airways.

Same shit here, on a smaller scale, but worse. SAA in particular. It is fxxked. Too much billions poured in each year and looted/etc. The union is right, govt./etc. talking about management restructure, union says that was done 3 times already before and it made no difference. Just some new pigs to join the feeding.
 

Big Daddy

Super User
India has a serious financial crisis of the magnitude of 2008 US financial crisis. The government is hiding the crisis in many ways. It is merging banks, limiting fund withdrawal (and also limiting economic growth) and selling assets. If the US is any example then India will take at least 10 years to recover from this crisis.
 

adsatinder

explorer
India has a serious financial crisis of the magnitude of 2008 US financial crisis. The government is hiding the crisis in many ways. It is merging banks, limiting fund withdrawal (and also limiting economic growth) and selling assets. If the US is any example then India will take at least 10 years to recover from this crisis.
Recovery only possible if investors with Industry & Business people have faith in such a mis-managed system.
Investment needs faith in system and the functioning of Govt.
New Rules and changing rules every now and then creates Chaos only.
Investors invest for longer term, not for short term at all.

Small businesses invest for faster returns from own pocket and for survival mostly in such conditions.
Small & Medium Enterprises are not getting any faith or support in system at all for any policy related matter.
They are now hopeless.

Closing eyes will not take you out of the crisis situation.
Forget all other things.


Banks are lending money to investors in a very professional ways.
If such Banks fail, it is failure of system only.
Yes Bank is main Lender for many projects, if they fail means something is seriously going wrong.
 
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adsatinder

explorer
Yes Bank crisis: Has Modi govt done enough to fix financial sector woes to revive economy?

The crisis at India’s fourth-largest private lender, Yes Bank, is a reflection of the wider set of problems being faced by India’s banking and financial sector.


THEPRINT TEAM 6 March, 2020 6:39 pm IST



Illustration: Soham Sen | ThePrint


The RBI has put Yes Bank under moratorium till 3 April, capping cash withdrawals at Rs 50,000. The crisis at India’s fourth-largest private lender is a reflection of the wider set of problems being faced by India’s banking and financial sector. Finance Minister Nirmala Sitharaman has asked the RBI to look into “what caused these difficulties” and announced state-owned lender SBI’s willingness to invest in Yes Bank.


ThePrint asks:
Yes Bank crisis: Has Modi govt done enough to fix financial sector woes to revive economy?


Steps like Mudra scheme, loan melas and waivers have weakened the banking sector
NIPFP N. R. Bhanumurthy


N R Bhanumurthy
Professor, National Institute of Public Finance and Policy


The situation of India’s banking and financial sector has been worsening for a long time now. Deteriorating balance sheets and ambiguity with regard to the treatment of non-performing assets and banking (including co-operatives) regulations have only deepened the problems. Prolonged growth slowdown and weakening fiscal positions of both the Centre and the states have also added to the woes.
While the Modi government, the RBI and the SEBI have been taking various measures — the Insolvency Bankruptcy Code, Prompt Coercive Action (PCA), proposed changes in the Banking Regulation Act, recapitalisation and merger of the PSBs (Public Sector Banks) — it appears that the problems in India’s banking sector are deep-rooted.
The Yes Bank episode suggests that the balance sheet issue is not limited to public sector banks alone, as opposed to what many were thinking. While one hopes that the Yes Bank-type problem would not be contagious, the government and the RBI need to be proactive in stabilising the sector.
Not just hesitancy but measures like Mudra, loan melas and loan waivers taken by governments have also weakened the banking sector. Hesitancy in recapitalisation of banks (no allocations in the recent Union Budget), merger of PSBs, and fear of prosecutions have hindered the growth of public sector banks.

Another structural issue that is hampering the sector is some of the government’s policy measures that actually discourage savings in the economy, which could put pressure on the banking sector performance.
Views are personal

Govt and financial sector regulators are putting in efforts, but the headwinds are too forceful and dynamic


Ashvin Parekh
Banking Expert & Managing partner, Ashvin Parekh Advisory Services LLP


The Narendra Modi government and India’s financial sector regulators are putting in efforts. Unfortunately, the headwinds confronting the sector and the Indian economy as a whole are too forceful and dynamic for all stakeholders to fathom.
It appears that many of the measures being taken are taking longer to have an impact, and new situations are arising.
The government and the regulators are seized with these developments and, therefore, we are lurching from one crisis to another.
The problems with India’s financial sector have their roots in a weak banking system, which is only getting weaker by the day. The recovery of non-performing assets is taking longer, and the government is unable to provide capital. New areas of sizeable debt turning bad, such as in the telecom sector, are evolving and fast decision-making is taking particularly longer.

Principle of expecting public sector giants to make up for failures of private banking is fundamentally flawed



Narendar Pani
Professor, National Institute of Advanced Studies


The Yes Bank crisis brings to the forefront the fact that the Narendra Modi government, for all its initiatives in the financial sector, has not confronted the critical aspect of the relationship between public and private institutions.
It is widely believed that before the one-month moratorium ends on 3 April, a consortium of the State Bank of India and the Life Insurance Corporation of India will take over the troubled bank. The depositors in Yes Bank will undoubtedly be relieved if this comes through and the limits on the withdrawal of their own money in the bank are lifted.
For those who have a stake in SBI and LIC there is reason to worry. These two institutions will be expected to bear the burden of the profligacy of Yes Bank’s lending.
But the principle of expecting these public sector institutions to make up for the failures of private banking is fundamentally flawed. It allows private financial institutions to be quite reckless knowing that the public sector will step in to clean the mess they have created. More importantly, if the current economic slowdown pushes more private banks the Yes Bank way, the burden could prove too great even for public sector giants like SBI and LIC.


Govt has been determined to weaken public sector banks, which are the pillars of India’s banking system


C H Venkatachalam
General Secretary, All Indian Bank Employees Association


The current NDA government has thoroughly failed to address the issues with India’s economy.
Banks have an important role in reviving the economy. Unfortunately, the government is not doing anything to strengthen our banks. Public sector banks (PSBs) are the pillars of India’s banking system.
Ever since banks were nationalised in 1969, PSBs have contributed immensely to economic development, especially in neglected sectors.
But the Modi government is determined to weaken PSBs. Bad loans is a major issue confronting the banks. Instead of tightening the recovery laws to ensure bad loan recovery, this government believes in resolution of bad loans. The result is huge haircuts for the banks, thus, landing them in losses.
According to the latest Economic Survey, for every rupee that a taxpayer invested in PSBs, he/she lost 23 paise on an average.
The question is about why no timely action was taken in the case of Yes Bank. What was the RBI doing all this while? Instead of strengthening the public sector banks to revive the economy, the government is only helping private-sector lenders, who are also responsible for the bad loans.




Yes Bank crisis: Has Modi govt done enough to fix financial sector woes to revive economy?
 

Big Daddy

Super User
India needs to be a competitive economy to attract money. Indians are still lazy bunch with an entitlement mentality. Guess what Modi wants? He wants NRIs to buy Air India and he will allow 100% ownership. Basically, his idea is that you went outside India and earned money so send it back so that we can give free rides to politicians in India. This is still stupid British Empire type thinking except people entitled are not British.


There is only one way to attract money and that is to give competitive returns. These entitlements are why India has a financial crisis. All those bloated government benefits were paid for by hard-working people and banks financed irresponsible businessmen with their emotionally driven reckless decisions. The money of common people was siphoned away by banks. Now there is nothing left. The government is not getting taxes, people are not getting salaries, and provident fund returns are cut. The only way out now is foreign cash, but those foreigners are not that foolish to fall for scams. Besides foreigners also have multiple opportunities to invest in so India needs to give higher returns to attract foreign money and also keep its currency stable. I think serious cost-cutting is needed to be competitive. The riots are going to continue for a few years. Modi may not get another term because you cannot create any more joomlas.
 

adsatinder

explorer
Serious Actions for economic recovery needs a good team work.
You can't do only selling your bad and good assests to others and continue your expenses meet like this for long.
Backbone of a country is basic economy made by all types of people. Earlier this explosion of population was not considered as a useless burden on economy.
In 2010-12 this was a growing market. All MNCs, Medium Scale, Small scale industries, businesses, services etc were attracted towards India and we're ready to play and invest huge amounts with growth of the economy. They invested heavily during that period. Now no one want here to invest for long time and get returns in much longer terms. No individual will do that to take risk in sinking economic conditions. Those MNCs can only invest who have 10-20 years of goals to start earning will enter here with stepwise investments. Seen many Chinese, Korean, Japanese companies during that period who invested here and we're getting rewards too. Now no one is coming here and staying here for marketing purpose. Just get order and supply it is only business left if there is any basic demand.
Population is now blamed as burden on economy.
Why ?

Team is lacking here.
A state running is totally different ball game.
Running a country is totally different thing.
An individual focused on isolated small family of 2 adults and 2 kids can run it easily.
But running a whole family tree is totally different game.
You have to win hearts and faith with confidence of all of the family.
This can be done with a good teamwork only.
When you deliver only order and ask to follow the rules is not going to win hearts and faith & confidence in your system.
Mindset of new generation is totally different.
You have new technologies but you are lacking it in practical life then no one can survive for long.
Humans need faith, confidence and love to move ahead.
Only fools spread hatred and get same in return.
 
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Big Daddy

Super User
You need a nationwide change in attitude, which is less likely to happen because such an attitude is rarely found in humanity. Throughout the world, people have this tendency of hoarding money, whether it is Saudis, Iranians, EU or Indians. The history of the world is that you get at the top, abuse power and accumulate wealth for yourself and your family. You work hard, cut deals, use religion or oppressive means to get to the top.

In India getting to the top also means government jobs and job reservations. Once you are at the top, you assume that you deserve wealth regardless of whether you work hard have skills or not. People who pay you are people who did not get to the top, but they also have to work hard because taxes they pay you to depend on people at the top.

I am somewhat optimistic about India. This economic crisis is slightly good for India because India will have to open its markets. So far people who invested money were Indians in cahoots with the Indian government. This time around it will be outside money and the Indian government will have to do a balancing act between competing interests. The necessary change in society will come out of need. Not changing is not an option.
 
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