India admits rupee withdrawal bad for economy

India's controversial withdrawal of high value banknotes late last year has had an "adverse impact" on the economy, the government has admitted.

The country's Economic Survey, released on the eve of the national budget, said the measures had slowed growth.

The dramatic move to scrap 500 ($7.60) and 1,000 rupee notes was intended to crack down on corruption and so-called black money or illegal cash holdings.

But it also led to a cash shortage, hurting individuals and businesses.

The report forecast that India's economy would grow 6.5% in the year to March 2017, down from 7.6% the previous financial year.

But it also stressed that the estimate was based "mainly" on data from before the note withdrawal kicked in - causing some to suspect growth may be lower still.

India's Finance minister Arun Jaitley who will deliver the Union budget in Delhi on Wednesday, said he expected the economy to "revert to normal" from March onwards after supplies of cash in the economy were replenished.

'Reduced demand'

Prime Minister Narendra Modi announced the so-called "demonetisation" policy on November 8 last year.

Within hours the two notes were no longer accepted as legal tender - taking the equivalent of about 86% of India's cash supplies out of circulation and sparking scenes of chaos outside banks and cash machines.

Low-income Indians, traders and ordinary savers who rely on the cash economy were badly hit, with hordes thronging banks to deposit expired money and withdraw lower denominations.

"The adverse impact... on GDP will be transitional", the government's chief economic adviser, Arvind Subramanian, wrote in the report.

"Growth slowed as demonetisation reduced demand ... and increased uncertainty," he added, saying negative impacts included including job losses and falling income for farmers.

However the report said the scheme could be "beneficial in the long-run" if corruption fell and there were fewer cash transactions - many of which are done to dodge taxes.

'Acknowledgement'

The government has previously said the move was a success with the banks flush with cash and significant increases in tax collection.

"It's very nice to understand that the survey is acknowledging the negative impact," said Aneesh Srivatava, chief investment officer at IDBI Federal.

"This is perhaps the first acknowledgement coming from the government. Otherwise so far there has been a denial."

Deadlines for spending the notes or swapping them for new currency have already passed.

Some people, including those of Indian origin living abroad, will be able to exchange the notes in branches of India's central bank until 31 March 2017 - but the process will be more complicated than going to a regular bank.

Source: http://www.bbc.com/news/business-38807695

Auckland law firm warning Canterbury homeowners of shoddy steel

An Auckland litigation firm is warning thousands of Canterbury homeowners their properties may have been built with shoddy steel mesh.

Adina Thorn Lawyers delivered letters to property owners this week asking them to express interest in a proposed class action against steel manufacturers.

Its move comes after the Commerce Commission told three companies, including Steel & Tube, that it will prosecute them over allegedly sub-standard mesh.

The firm identified properties built since 2012 on concrete floors reinforced with steel mesh as being at risk, but says it does not know if homeowners it contacted are affected.

Adina Thorn is experienced in running class actions, last year filing a $250 million civil lawsuit, involving about 1000 people, against cladding maker James Hardie.

Adina Thorn herself said about 2000 letters were posted to Canterbury homeowners, resulting in about 70 calls to her firm in one day.

Thorn said addresses contacted were based on territorial authority records of building consents and Christchurch City Council consent issues.

“Not every person that gets the letter will in fact have defective steel, but some of them will,” Thorn said.

The letter stated a guilty verdict was unlikely to mean financial compensation for homeowners.

“We’re just saying register if you’ve got an interest in this and we would take it from there,” Thorn said.

“We would look into them and see whether they could have steel from one of the relevant companies the Commerce Commission’s looking into or not.”

The city council had fielded between 30 and 40 calls regarding the letter.

It did not accept there could be thousands of properties built using non-compliant steel mesh.

Consenting and compliance general manager Leonie Rae said the issues raised in the letter were “nationwide” and suggested homeowners contact the Ministry of Business, Innovation and Employment and the Commerce Commission for advice on potential issues.

The council was confident its methods for checking the compliance of steel mesh were robust.

Thorn said her firm was seeing whether there was enough interest for a funder to pay for the action, which looked likely.

“Then we look at the viability owner by owner . . . We carry out a process to work out what the steel is and the merits of that claim.”

Source: http://www.stuff.co.nz/business/88572756/auckland-law-firm-warning-canterbury-homeowners-of-shoddy-steel

E-cigarettes major concern, says US

The chief public health officer of the US, the Surgeon General, has called the use of e-cigarettes by children "a major public health concern".

In a report due to be released on Thursday, Vivek Murthy recommends more regulation and taxation.

His report agrees that e-cigarettes are less harmful than actual ones, but his concern is that the devices expose children to the risks of nicotine.

E-cigarettes are devices that turn nicotine liquid into a vapour.

Because they do not actually burn any material but leave users merely inhaling nicotine in steam, they are seen by some health experts as preferable to smoking cigarettes and, by some, as a way to give up cigarette smoking.

Dr Murthy's report says there is not enough evidence that prove e-cigarettes work in this way.

For young people, he says, e-cigarette use is strongly linked with the use of other tobacco products.

Dr Murthy says nicotine usage by young people risks mood disorders, attention deficits and addiction to nicotine that could lead to the use of traditional cigarettes.

Many tobacco companies are pinning their future on e-cigarettes and other alternatives as people continue to move away from using traditional nicotine products.

Last month, Marlboro maker Philip Morris launched a new product in the UK, Iqos, which it said could mean halting sales of its conventional tobacco products.

Source: http://www.bbc.com/news/business-38247778

Brexit: French financial regulator wooing London banks

Some major banks are in advanced stages of planning to shift some operations from London to Paris, France's leading financial regulator has told the BBC.

Benoit de Juvigny said that "large international banks" have undertaken the due diligence needed to set up a subsidiary in the French capital.

He also told Newsnight that "many other companies" had lodged informal inquiries about moving post-Brexit.

He expects similar talks to be going on in Europe's other financial centres.

Authorities in Frankfurt, Luxembourg and Amsterdam have said they would welcome banks moving operations from London for when the UK leaves the European Union.

For many years, British-based financial services companies have been able to operate throughout Europe using so-called passporting rights.

That scheme may end when Britain leaves the EU, with no guarantee that it will be replaced by a similar agreement.

It is that uncertainty that had led many financial companies - and particularly international banks - to make contingency plans that would see them transfer a chunk of their business to an EU member country.

Dangers

Newsnight has learned that at least eight centres are now actively vying for this business - Paris, Frankfurt, Dublin, Luxembourg, Amsterdam, Madrid, Bratislava, and the Maltese capital, Valletta.

But the extent to which these plans have been progressed has been hard to ascertain - until now.

Mr de Juvigny's disclosure that major banks have gone as far as conducting due diligence shows an important milestone.

Due diligence is the process of close scrutiny that major businesses go through prior to a major deal. It is detailed and expensive, and even wealthy banks don't undertake it lightly. What's more, if Mr du Juvigny is right, then it's being conducted in multiple cities around Europe.

He said that the French regulatory department was likely to be expanded to cope with any influx of companies.

However, he warned about the impact of regulators trying to compete to attract banks, saying: "The danger is the race that we could have for a more lenient regulation with a more lenient regulator."

He said the risk of such leniency was lax regulation that could lead to another financial crisis, and called for Europe to stick "strictly" to existing legislation.

"I don't believe that [lenient regulation] should be the choice of the UK, but nobody knows," he said.

Source: http://www.bbc.com/news/business-38245646

BBC tests 4K Planet Earth II in HDR on iPlayer

The BBC has begun a trial of 4K high dynamic range (HDR) video on its iPlayer streaming platform.

The test involves four minutes of footage from its Planet Earth II series, which promise to reveal more detail and present more vibrant colours than was possible before.

It is part of efforts to develop technologies that will make live broadcasts in the new formats possible.

But only a minority of TVs can screen the footage at this stage.

“One of the clips is a frog on a leaf with lots of rain, and the reason this is so interesting is that the redness of the frog is a really deep Ferrari red that you would never get in broadcast television at the moment,” explained Phil Layton, head of broadcast and connected systems at BBC Research & Development.

“We want to show that this is how the BBC could make ultra-high definition HDR material available to iPlayer.

“And we want to use this as a trigger to work with manufacturers to get their products updated so there’s a pathway there for future on-demand BBC content.”

As the trial went live, only Panasonic’s latest screens supported the test’s underlying technology – known as hybrid log-gamma (HLG).

Although recent models from other manufacturers can also be updated to add the facility, it is unclear whether the firms will do so.

Holding back support for HLG would give the companies an opportunity to market future models as being the first to support the format closer to when it launches.

More pixels, better pixels

From the consumer’s point-of-view, there are two key improvements.

A 4K picture – also referred to as ultra-high definition (UHD) – means that four times as many pixels are used than in 1080p HD.

This makes it possible to reveal details – such as the texture of an animal’s fur or the faces of the crowd at a football match – that would have appeared more blurry otherwise.

The main caveats are that the TV needs to be suitably large and the viewers close enough to it, otherwise they will not appreciate the difference.

HDR takes advantage of the fact displays can go brighter than before to allow an image to be graded with more levels of brightness between black and white.

This is not about everything looking brighter, but rather using the greater contrast range to allow shadows to appear less murky and highlights – such as sunlight gleaming off water or stars twinkling at night – to be better defined.

In addition, HDR uses a wider colour space – meaning it is capable of showing shades of colours that could not be transmitted in traditional broadcasts, helping footage appear more lifelike.

Many people who have experienced both, say that HDR has a greater impact on picture quality than 4K.

“It gives more nuance to the picture, which if you are talking about Planet Earth is going to be amazing,” said Stuart Miles, founder of the Pocket-lint news site.

“The best way to describe it is it’s like when you add a subwoofer to a sound system.

“Until you’ve had it you don’t realise you need it, but once you’ve added it you ask how you could have lived without it.”

Higher costs

The BBC will make the footage available via the different smart TV versions of its iPlayer app as soon as the relevant models support it.

But it will be some time before it starts offering scheduled broadcasts in 4K and HDR.

Mr Layton said the technological challenges could be resolved within the next 18 months.

But programmes will cost more to make if they take advantage of the innovations. So, the improved quality will have to be weighed against the fact the majority of viewers will be unlikely to have TVs that support the new technologies for some time to come.

In the meantime, Amazon and Netflix both offer some pre-recorded shows and movies in HDR and 4K.

And BT and Sky both offer movies and sport in 4K but not HDR.

Source: http://www.bbc.com/news/technology-38242187