The parent of Silicon Valley Bank, seized last week by the U.S., is filing for Chapter 11 bankruptcy protection
Published Date – 09:45 PM, Fri – 17 March 23
Washington: The parent of Silicon Valley Bank, seized last week by the U.S., is filing for Chapter 11 bankruptcy protection.
SVB Financial Group, along with its CEO and its chief financial officer, were targeted this week in a class action lawsuit that claims the company didn’t disclose the risks that future interest rate increases would have on its business.
SVB Financial Group is no longer affiliated with Silicon Valley Bank after its seizure by the Federal Deposit Insurance Corp. Its collapse was the second biggest bank failure in U.S. history after the demise of Washington Mutual in 2008.
The bank’s successor, Silicon Valley Bridge Bank, is being run under the jurisdiction of the FDIC and is not included in the Chapter 11 filing.
“The Chapter 11 process will allow SVB Financial Group to preserve value as it evaluates strategic alternatives for its prized businesses and assets, especially SVB Capital and SVB Securities,” William Kosturos, Chief Restructuring Officer for SVB Financial Group, said in a statement on Friday.
Regulated broker-dealer SVB Securities and funds of venture capital and private credit fund platform SVB Capital and its general partner entities are not included in the Chapter 11 filing and continue to operate normally.
Funded debt for SVB Financial Group is about $3.3 billion in aggregate principal amount of unsecured notes. There is no claim against SVB Capital or SVB Securities. SVB Financial Group also has $3.7 billion of preferred equity outstanding.
SVB Financial Group believes it has approximately $2.2 billion of liquidity. The Santa Clara, California-based company said it also has other valuable investment securities accounts and other assets that it’s exploring strategic options for.
The shuttering of Silicon Valley Bank last Friday and of New York-based Signature Bank two days later has revived bad memories of the financial crisis that plunged the United States into the Great Recession of 2007-2009.
Over the weekend the federal government, determined to restore public confidence in the banking system, moved to protect all the banks’ deposits, even those that exceeded the FDIC’s $250,000 limit per individual account.
India is likely to see its gig workforce add 9-11 million jobs by 2025, which has been one of the most pivotal economic shifts in a long time
Updated On – 06:36 PM, Sat – 18 March 23
Representational Image
New Delhi: With a spurt in online food and grocery delivery, especially in the pandemic years, India saw a meteoric rise in the gig economy, giving millions of people job opportunities.
However, delivering hot and piping food at customers’ doorsteps has become a nightmare for many of them as the food delivery business turns out to be a losing game while more and more delivery partners report unfair work conditions, pay disparity, and harassment.
India is likely to see its gig workforce add 9-11 million jobs by 2025, which has been one of the most pivotal economic shifts in a long time.
In terms of job roles, door delivery is the most prevalent gig role employers are hiring for currently — 22 per cent for food and 26 per cent for other deliveries, according to a recent study by leading job portal Indeed.
According to reports, a typical delivery boy’s salary is Rs 15,000 per month. Delivery Boy salaries at Zomato and Swiggy can range from Rs 4,804-Rs 30,555 per month depending on which area they are working in.
Gig workers are freelancers or contractors who work independently, typically on a short-term basis for multiple clients. Their work may be project-based, hourly, or part-time.
However, when it comes to fair work for gig workers among the digital platform economy in India, Zomato, Swiggy, and quick-grocery delivery providers Dunzo and Zepto are among the worst performers across parameters related to the working conditions of gig workers, according to the latest ‘Fairwork India Ratings 2022 Report’.
According to professor Balaji Parthasarathy, one of the principal investigators of the team, these findings are alarming for all stakeholders — government, consumers and platform owners — and they should come together to help gig workers get the best working conditions.
“We would like the government and other stakeholders like consumers and digital labour platform owners to take note of these findings and ensure a better work environment for millions of gig workers in 2023,” Parthasarathy said.
The Fairwork India team was spearheaded by the Centre for IT and Public Policy (CITAPP), International Institute of Information Technology Bangalore (IIIT-B), in association with Oxford University in the UK.
Even with workers and worker groups repeatedly emphasising the importance of a stable income for platform workers, platforms have been reluctant to publicly commit to, and operationalise, a minimum wage policy.
“Secondly, while workers have engaged in various forms of collective action to voice their concerns in the platform economy, platforms have been uncompromisingly unwilling to recognise or negotiate with any collective body representing workers,” the findings showed.
According to the report, the promise of flexibility of the digital platform economy raises as many questions about livelihoods as it offers opportunities.
“We hope the report provides the basis for an interpretation of flexibility that allows for not merely the adaptability that platforms seek, but also the income and social security that workers lack,” said Parthasarathy and Janaki Srinivasan, the Principal Investigators of the team.
The biggest barriers for gig workers are lack of access to job information (62 per cent), not knowing English (32 per cent), and not knowing the local language (10 per cent) for workers who have shifted outside of their home town for work.
Challenges in language also result in other difficulties with 14 per cent of the gig workforce respondents reporting a lack of awareness of their jobs’ skills and abilities, according to Indeed study.
Nearly three out of five gig workers (59 per cent) find their jobs uncomfortable (46 per cent), if not hard and risky (13 per cent).
The government has also cracked a whip on online food aggregators in the recent past.
Last year, the Competition Commission of India (CCI) ordered a thorough investigation into the conduct of online food delivery platforms Zomato and Swiggy over alleged involvement in delayed payment cycle and exorbitant commissions.
Following a complaint from the National Restaurant Association of India (NRAI), the CCI said that it is of the view that there exists a prima facie case with respect to some of the conduct of Zomato and Swiggy, “which requires an investigation by the Director General (DG), to determine whether the conduct of platforms have resulted in contravention of the provisions”.
The NRAI had alleged that the commissions that are charged from restaurants are “unviable” and “are to the tune of 20 per cent to 30 per cent, which are extremely exorbitant”.
The Department of Consumer Affairs also asked online food business operators to improve their consumer grievance redressal mechanism amid rising complaints from customers.
The Delhi High Court last month postponed the hearing on petitions to April 12, filed by restaurant associations contesting the rules that forbid hotels and restaurants from automatically adding a service charge to meal bills.
The Central Consumer Protection Authority (CCPA), under the Department of Consumer Affairs, released the rules last year, and the high court stayed them.
The CCPA has sought dismissal of pleas and said in its affidavit that the petitioners have totally failed to appreciate the rights of the consumers by adopting an unfair method, which is unlawful as no service is separately provided to consumers.
Parliamentary Standing Committee has taken note of the high air fares charged by some airline operators in the domestic sector
Published Date – 07:06 PM, Sat – 18 March 23
Representational Image
New Delhi: A Parliamentary Standing Committee has taken note of the high air fares charged by some airline operators in the domestic sector, and held that they are misguiding the public and forcing passengers to pay more.
The Committee also pointed out the wrong information published by the private airlines on their websites, regarding the number of seats left in the flight and the prices of the tickets.
“The level of misinformation can be gauged from the fact that even after the last tickets have been sold, the same number of seats show on the website, as indicated before the tickets sale. This indicates that airline operators are misguiding the public and forcing passengers to pay more,” the panel said in the Demand for Grants (2023-24) report of the Civil Aviation Ministry.
In view of the above, it recommended that the Ministry should formulate appropriate guidelines regarding rationalisation of fares and publishing the correct information on the website of the airlines.
It also pointed out that ‘Predatory Pricing’ is being restored to by the domestic airlines sector. “A particular airline may sell its air tickets at such a low level, that other competitors cannot compete and are forced to exit the market. A company that does this will see initial losses, but eventually it benefits by driving competition out of the market and raising its prices again,” said the report.
The Committee desired to know whether aviation regulator, the DGCA had at any point of time intervened to check the fares of air tickets. It also expressed concern at the fact that in the domestic sector, private airlines are charging different fares for the same sector, route and same direction of flights.
This is specifically so for the northeastern region and hilly areas including Jammu & Kashmir and Ladakh, where the prices of domestic sector tickets are, sometimes, even more than the international airline sector prices.
The Committee took note of the fact that after the repeal of the Air Corporations Act, 1953, the airfare is market driven and depends on market fares, and is neither established nor regulated by the government.
“It notes the DGCA’s comments that the airfares were regulated for a fixed period during the Covid pandemic in compliance with Aircraft Act, 1934 and the regulation was withdrawn as the Covid pandemic abated and that airlines are free to fix reasonable tariffs under the Aircraft Rules, 1937, with regard to cost of operation, services, reasonable profit and generally prevailing tariff,” said the report.
India is growing but the sequential quarter growth is declining and the economy is losing steam, said former Union finance minister P Chidambaram
Published Date – 07:45 AM, Sun – 19 March 23
File photo: Chidambaram
New Delhi: Senior Congress leader and former Union finance minister P Chidambaram Saturday said India is growing but the sequential quarter growth is declining and the economy is “losing steam”. He also accused the Narendra Modi government of “neglecting” the poor and the very poor.
“The reality is we are growing but the quarter upon quarter growth or the sequential quarter growth is declining — 13.2 per cent, 6.3 per cent, 4.4 per cent and the fourth quarter, my estimate is, between 4.1 per cent and 4.3 per cent.
“So, it is a declining quarterly growth rate, which means the Indian economy is losing steam,” Chidambaram said at the India Today Conclave.
Asked about India growing faster among the major economies of the world, the former finance minister said, “There is no boast in saying ‘I am the one-eyed monarch of the blind’. The point is China, when it grows at 3 per cent or 3.5 per cent, will still add every year to its annual wealth or annual output several times more than India growing at 7 per cent.” “China is five-and-a-half-times larger than India. Therefore, the relevant number is the per capita income and (according to) per capita income, we are still a very poor country, he said.
Chidambaram also said the BJP-led NDA government was wrong in not providing fiscal stimulus during the pandemic.
“The government was wrong in not giving a fiscal stimulus. That’s why three crore people had to migrate from other cities and states, back to Bihar and Uttar Pradesh,” he said.
Asked what would be the one thing he would credit the government with, Chidambaram said he would give credit to this government for its single-minded focus on containing the deficit and debt management.
“I have no hesitation in giving credit where it is due, but all I am pointing out is there is so much more to be done,” Chidambaram said.
“A prime minister with so much energy, drive and control over his party can do so much more. Instead of that, we are talking about a non-interview and documentary. Why are we wasting time on those things?” he posed.
Neelkanth Mishra, who is a member of the Economic Advisory Council to the Prime Minister, said what is extremely important right now is that in this global financial turbulence if India is seen as a stable economy, it will continue to attract foreign investors, foreign companies, which can bring skills and technology.
“So on a five-year basis, the expectations of India’s GDP growth should be that India will contribute 12-15 per cent of incremental GDP in the next five years,” he said.
Mishra also contended that the quarterly GDP numbers are extremely inaccurate.
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