This article was written by

KOLKATA: The West Bengal government is preparing a comprehensive industrial promotion policy that blends budgetary outlays with off-balance-sheet incentive mechanisms, finance minister Swapan Dasgupta said.The government is exploring off-balance sheet incentives like soft loans to keep the weightage on budget-dependent industrial promotion lower, the finance minister said. Concession on power tariff is also being explored. On the budgetary side, a combination of capital subsidies and tax reimbursements are also being considered even as the state’s Rs 8 lakh crore outstanding debt keeps its finances on strain.

Mumbai: India’s capital markets regulator has rejected settlement applications by foreign portfolio investors (FPIs) that held significant stakes in listed Adani Group companies, people familiar with the matter said. This was because the FPIs’ terms failed to align with those proposed by Sebi, they said.

The regulator communicated its decision to the FPIs’ representatives last week, the people said, reviving a case that dates back to October 2020, when Sebi’s surveillance systems first flagged the unusual concentration of their holdings. Sebi’s investigation had flagged 13 FPIs. They subsequently sought to settle the case.

“The terms were not in line with the settlement terms suggested by Sebi. Therefore, Sebi rejected the application,” the regulator said in its communication to the FPIs. “This recommendation (rejection of the application) of HPAC (high-powered advisory committee on settlement orders) was accepted by the panel of whole-time members in terms of regulation 15(1) of the Settlement Regulations, 2018.”

ET has reviewed the letter’s copy.

Read more: Sebi proposes tighter curbs on promotional claims by online bond platforms

At the centre of the standoff, according to one of the people, was the reluctance of some FPIs to fully disclose information Sebi considered essential to any settlement. “You have to come clean if you want to settle a case. Some FPIs were unwilling to provide certain details to Sebi, which was a precondition for settlement,” the person said. “Entities must first agree to the non-monetary terms.”

Breach of Securities Law
Another person said some FPIs, at a joint meeting with Sebi, were unwilling to ‘disgorge’ the amount sought by the regulator, which ran into hundreds of crores.

Settlement is a well-trodden route for entities facing securities law violations in India, one that lets them resolve disputes without admitting or denying wrongdoing. An applicant proposes terms to Sebi, which reviews the application and counters with its own, typically a monetary settlement amount, and sometimes non-monetary conditions such as trading bans. The two sides negotiate, and the final proposal goes to Sebi’s high-powered advisory committee, led by a former high court judge, for approval or rejection.

The 13 FPIs are Albula Investment Fund, Cresta Fund, MGC Fund, Asia Investment Corporation (Mauritius), APMS Investment Fund, Elara India Opportunities Fund, Vespera Fund, LTS Investment Fund, Emerging India Focus Funds, EM Resurgent Fund, Polus Global Fund, New Leaina Investments and Opal Investments.

The funds filed multiple settlement applications in April 2024 after Sebi issued show-cause notices to them under two separate tracks – one questioning why their FPI registrations should not be cancelled, and the other seeking to fine them for breaches of securities law. It could not be ascertained which applications were turned down.

The regulator’s original concern was whether these FPIs were genuine public shareholders, or fronts for the Adani Group’s own promoters.

The probe gained global attention after a January 2023 report by Hindenburg Research accused the Adani Group of round-tripping and market manipulation, triggering a sharp sell-off in its stocks. The conglomerate denied the allegations.

In its submissions to the Supreme Court in August 2023, amid multiple public interest litigations seeking a probe into the Hindenburg claims, Sebi disclosed that it had reviewed trading in seven Adani stocks – Adani Enterprises, Adani Ports & SEZ, Adani Green Energy, Adani Energy Solutions, Adani Power, Adani Total Gas and Adani Wilmar – between March 2020 and December 2022, examining price-volume manipulation and breaches of minimum public shareholding, FPI investment limit and offshore derivative instrument norms.

The regulator identified 42 contributories to the FPIs’ assets under management. But it hit a wall trying to trace their ultimate beneficial owners, hampered by a lack of cooperation from its foreign counterparts.

When the Supreme Court disposed of the PILs in January 2024, it directed Sebi to bring its investigations to a “logical conclusion in accordance with law.”

With Sebi rejecting the settlement applications, the regulator will now continue legal proceedings against the FPIs.

Sebi, Adani Group and the FPIs did not respond to emailed queries.

Second Chance

The door may not stay shut for long. Sebi is planning to revise its settlement rules in a way that could give rejected applicants, including, potentially, these FPIs, another shot at resolving their cases.

Currently, an entity that has had its settlement application rejected cannot reapply at any stage of proceedings, including during an appeal. Under the proposed changes, applicants would be allowed to return to the settlement table if circumstances have changed and the grounds for the original rejection no longer apply. The price of a second chance: an additional 20% on top of the settlement amount.

Growing up in Manchester, Mia Tanswell didn’t give her accent much thought – until her first week at university in Loughborough.

“I knew people were going to notice that I was northern and that I didn’t speak the ‘Queen’s English’,” the 22-year-old says.

“Definitely in seminars I would sometimes feel like my accent would sound a bit less intellectual than other people, especially if I was the only northern student in the classroom.”

She’s not alone. Fresh polling seen by the BBC suggests many workers still see so-called “accent bias” as a problem.

The survey found one in 10 people in Britain feel anxious or self-conscious about their accent in high stakes professional settings such as speaking up in a business meeting.

The research, conducted by the organisation More in Common of more than 3,300 adults across England, Scotland and Wales, found accent-related anxiety in work settings like these was highest among Geordies – from the region around Newcastle – and those with an east London – or Cockney – accent (at 19%), followed by people with a Welsh accent (at 18%).

Around 5% of respondents believed their accent had cost them a promotion, pay rise or senior role. “Brummies” – people from Birmingham – were the most likely to feel this, at 13%.

Respondents with a West Country accent reported the highest rate of having their accent mocked or criticised by colleagues, at 15%, followed by 13% of those with a Geordie accent.

The poll was commissioned by Common Ground, an organisation which aims to promote social cohesion. Its founder, Lara Newman, has worked in construction, property and the built environment industry for more than 30 years, and says she changed her own accent to get ahead in the workplace.

“I am incredibly realistic about what would have happened had I gone to university or gone into the workplace with a strong west country accent,” she says. “I felt like that was going to be an issue for me.”

Common Ground aims to support people from disadvantaged backgrounds into work but she says one of the layers creating a barrier to them is accent.

“I think there is a problem in the sense that [an accent] implies a level of education or otherwise. It implies class,” she says.

A review is being launched into the way business rates are calculated for pubs and hotels in England and Wales, and could lead to a reform of the system.

The Treasury says business rates expert Jerry Schurder will lead the review into rate valuations and report back in March 2027, with the government calling for the views of landlords, hoteliers and business owners to feed in to the process.

Last month, Andy Burnham announced a 20% cut in business rates for pubs, social clubs and live music venues in England, to come into effect in April.

Pub groups have argued they face disproportionately higher rates bills, but other businesses have called for a wider reform of the rates system.

According to the British Beer and Pub Association (BBPA), 161 pubs closed in the first three months of this year across England, Scotland and Wales, equating to the loss of around 2,400 jobs.

Rising business rates are cited as one issue facing the sector, although there have also been complaints that increases in National Insurance and the minimum wage have made staff costs more expensive.

James Murray, financial secretary to the Treasury, said the new review would look at “a rethink of valuations – so that we can build a fairer system for the future”.

Emma McClarkin, chief executive of the BBPA, said: “For years pubs have paid a disproportionately higher business rates bill which has ground down their ability to keep the doors open, so this review is sorely needed and hugely welcome.”

The BBPA says pubs are valued differently for rates than retail venues. Instead of being based just on floor area, they are judged by a measure called Fair Maintainable Trade – which means when a pub’s turnover increases, so does its rates bill.

Schurder is a former business rates policy lead at advisory firm Newmark UK, and his review will feed into the next rates revaluation in 2029.

His appointment was welcomed by Craig Beaumont of the Federation of Small Businesses (FSB) who said he would bring “crucial heavyweight business rates expertise into the Treasury”.

However, Beaumont said the government needed to address the wider business rates system and exempt more smaller firms by increasing the rates relief threshold for small businesses.

Tom Ironside from the British Retail Consortium also welcomed the review but said it was “vitally important that the needs of retailers are not overlooked”.

Shadow Chancellor Sir Mel Stride said the review was “far too late for a sector this Labour government has already done its best to kill off”.

“Tax hikes on business premises and jobs, alongside job-destroying regulation in the Employment Rights Act, have left many hospitality businesses on the brink,” he said.

Liberal Democrat Treasury spokesperson Daisy Cooper said reform of business rates was “long overdue”, but also called for an emergency VAT cut and a reverse to jobs tax changes “which have hammered hospitality in particular”.