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In relief for India, US could delay action on oil, trade sanctions till June

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India and the US won’t immediately escalate vexed trade-related issues and are expected to hold their position on all important matters till a new government is formed in New Delhi by the month-end, officials with knowledge of the matter said on Tuesday.

US commerce secretary Wilbur Ross too hinted the two sides will maintain their positions in his speech at the Trade Winds business forum, while raising the issue of trade imbalance with India.

“We applaud India’s commitment to addressing some of these barriers once the government is reformed, probably starting in the month of June,” he said.

Election-bound India is expected to form a new government before the tenure of the current Lok Sabha ends on June 3.

India’s main concerns include the US decision to enforce sanctions on oil imports from Iran, one of the country’s main energy suppliers, and the withdrawal of benefits under the Generalized System of Preferences (GSP) programme.

Washington is concerned by the trade imbalance because of tariff and non-tariff barriers, and regulations that US officials say put foreign companies at a disadvantage.

According to the officials cited above, India has explained to the US that strategic matters, including trade-related issues, can be effectively dealt with after the new government is formed.

They added the US has hinted it might make a final decision on withdrawing incentives under GSP after the new government is formed.

The two sides are also locked in disputes over Indian price caps on imported US medical devices, and e-commerce rules barring companies from selling products through firms in which they have an equity interest.

Ross contended India’s push to get foreign firms to store more of their user data locally is a hindrance to trade, and said India’s treatment of Walmart after its acquisition of Flipkart was an “important issue”.

“So the American companies are showing very good will and a very cooperative attitude towards ‘Make in India’ and the other programmes,” Ross told CNBC-TV18. “But there’s a limit to how far the discriminatory behaviour can go.”

Commerce minister Suresh Prabhu said he had “an excellent” meeting with Ross on Monday, during which they discussed “how to take this relationship to the next level”.

Prabhu expanded US President Donald Trump’s slogan “Make America great again” to “Let’s make America great again by making India-US relationship far better again”. Ross rephrased it to “MAGAWIC”, or “Make America great again with Indian cooperation”.

Ross told the business forum US technologies and expertise can play a key role in developing India’s economy but faced “significant market access barriers”. Noting that India is the third largest economy and would become the largest consumer market by 2030, he added: “Yet today, India is only the US’ 13th largest export market due to overly restrictive market access barriers.”

On the other hand, the US is India’s largest export market, accounting for about 20% of the total. “That’s a real imbalance, and it’s an imbalance we must drive to counter,” he said.

He contended India’s average applied tariff rate of 13.8% is the highest of any major world economy and its “bound tariff rates”, or the highest rate that can be charged, on agricultural products ranged from 113.5% to 300%.

Ross referred to Trump’s vision of a free, open and prosperous Indo-Pacific and said India is key to the US administration’s approach to the region.

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Bill Gates no longer world’s second richest person. Guess who is?

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Bill Gates has never ranked lower than No. 2 in the seven-year history of the Bloomberg Billionaires Index. That run ended Tuesday when the Microsoft Corp. co-founder dropped to No. 3 behind France’s Bernard Arnault.

LVMH, Arnault’s luxury-goods maker, advanced to a record Tuesday and pushed his net worth to $107.6 billion and ahead of Gates by more than $200 million. The shares extended their gains Wednesday, rising 0.7% at 1:54 pm in Paris. Arnault has added about $39 billion to his fortune in 2019 alone, the biggest individual gain by far among the 500 people in Bloomberg’s ranking.

Arnault, 70, joined Gates and Amazon.com Inc. founder Jeff Bezos, the world’s richest person, in the most exclusive wealth club last month, when his fortune surpassed $100 billion for the first time. The trio’s collective wealth exceeds the individual market values of almost every company in the S&P 500 Index, including Walmart Inc., Exxon Mobil Corp. and Walt Disney Co.

This year has been particularly good to French tycoons, with Arnault, Kering SA’s Francois Pinault and cosmetics heir Francoise Bettencourt Meyers tacking on a combined $57 billion.

Arnault and his family are among luxury titans who pledged more than $650 million in April for the reconstruction of Notre Dame Cathedral after fire ravaged the landmark church. He controls about half of Paris-based LVMH through a family holding company and also owns a 97% stake in Christian Dior, the fashion house founded three years before his birth in 1949.

Arnault entered the luxury-goods market in 1984 by acquiring a textile group that owned Christian Dior. Four years later, he sold the company’s other businesses and used the proceeds to buy a controlling stake in LVMH. His art collection of modern and contemporary paintings includes pieces by Jean-Michel Basquiat, Damien Hirst, Maurizio Cattelan, Andy Warhol and Pablo Picasso.

Were it not for Gates’s philanthropic giving, he’d still be the world’s richest person. Gates has donated more than $35 billion to the Bill & Melinda Gates Foundation. Bezos’s net worth is up slightly this year to $125 billion, even after reaching a divorce settlement with MacKenzie Bezos that made her the world’s fourth-richest woman.

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Libra crypto won’t launch until regulatory concerns are addressed, says Facebook

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Facebook Inc said on Monday it would not proceed with the launch of its Libra cryptocurrency until regulatory concerns are addressed, as the US Treasury secretary took the unusual step of saying he had serious concerns it could be used for illicit activity.

David Marcus, who oversees Facebook’s blockchain efforts, planned to tell Congress that Libra is not being built to compete with traditional currencies or interfere with monetary policy.

“The Libra Association, which will manage the (Libra) Reserve, has no intention of competing with any sovereign currencies or entering the monetary policy arena,” Marcus was due to say on Tuesday, according to prepared testimony released by the Senate Banking Committee. “Monetary policy is properly the province of central banks.”

“Facebook will not offer the Libra digital currency until we have fully addressed regulatory concerns and received appropriate approvals,” he said.

Speaking with reporters, Mnuchin said he was not comfortable with Libra currently, particularly in guarding against money laundering and other illicit use. “They’re going to have to convince us of very high standards before they have access to the US financial system,” he said.

Mnuchin is the latest senior US regulator to air concerns with the product, days after Federal Reserve Chairman Jay Powell expressed similar worries about the digital currency could be misused.

“These cryptocurrencies have been dominated by illicit activity and speculation,” said Mnuchin.

In his prepared testimony, Marcus said the Libra Association, the companies behind the Facebook-led cryptocurrency, planned to register as a money services business with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) and fully expected to comply with anti-money laundering and Bank Secrecy Act rules.

Since announcing the Libra project last month, Facebook has faced a torrent of criticism and skepticism from policymakers across the world who cite concerns over data security, money laundering and consumer protections.

Marcus was scheduled to testify on Tuesday and Wednesday before congressional committees overseeing financial issues and several members have suggested the product be barred.

Addressing some of those concerns, Marcus said in his prepared testimony that partners providing financial services with Libra will be required to comply with anti-money laundering rules. The Libra Association will not hold personal data of users beyond basic transaction information, and personal information provided to Calibra, the digital wallet Facebook is developing to hold Libra, will not be shared with the social media company and cannot be used for targeting ads.

Marcus added that he expected the Swiss Federal Data Protection and Information commissioner to be Libra’s privacy regulator because the Libra Association is headquartered in Geneva. The association is also in preliminary talks with the Swiss Financial Markets Supervisory Authority on “an appropriate regulatory framework.”

While promising Libra will adhere to relevant laws and regulations, Marcus aimed to sell lawmakers on the product’s merits as well, arguing the United States should not stifle such innovation.

“I am proud that Facebook has initiated this effort here in the United States,” his testimony said. “I believe that if America does not lead innovation in the digital currency and payments area, others will. If we fail to act, we could soon see a digital currency controlled by others whose values are dramatically different.”

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RBI to come out with mobile app for currency notes identification

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The Reserve Bank of India will come out with a mobile application to help visually challenged people in identifying currency notes as cash still remains a dominant mode of transaction.

At present, banknotes in the denominations of Rs 10, 20, 50, 100, 200, 500 and 2,000 are in circulation, besides Re 1 notes issued by the Centre.

The RBI said that identification of banknote denomination is key to successful completion of cash-based transactions by visually impaired persons.

Intaglio printing based identification marks for helping the visually challenged in identification of banknotes denomination are present in the notes of Rs 100 and above.

After demonetisation of old Rs 500/1,000 notes in November 2016, new banknotes in design and sizes have been put in circulation.

“The Reserve Bank of India has been sensitive to the challenges faced by the visually challenged in conducting their day to day business with Indian banknotes,” said the central bank while scouting for a vendor to develop the mobile application.

The proposed mobile app would be able to identify the denomination of notes of Mahatma Gandhi Series and Mahatma Gandhi (New) series by capturing the image of the notes placed in front of mobile camera, the RBI said while inviting bids from tech firms to develop the app.

The RBI had come out with a similar ‘request for proposal’ from vendors but later cancelled it.

The app will also generate “audio notification” intimating the currency note denomination to the user if image is captured correctly, else intimating the user to try again in case of image is not readable.

There are about 80 lakh blind or visually impaired people in the country, who are likely to benefit from the initiative of the central bank.

In June, 2018 the central bank had declared that it would explore the feasibility of developing a suitable device or mechanism for aiding the visually impaired in the identification of Indian banknotes.

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