Boeing sued over Ethiopia crash as plane orders in Asia waver

Boeing Co. was sued on behalf of a passenger killed in this month’s 737 Max plane crash in Ethiopia and orders for the troubled aircraft wavered in Asia, deepening the planemaker’s legal and financial woes.

Chicago-based Boeing is under intense scrutiny after two crashes since October killed 346 people.

As the company finalizes a software upgrade for the grounded 737 Max, it’s fighting to hang onto some customers whose confidence in the best-selling jet has been shaken. Boeing is also facing a criminal probe into how the plane was originally approved to fly.

The lawsuit, filed on behalf of the estate of Ethiopian Airlines passenger Jackson Musoni of Rwanda, claims the 737 Max 8 isn’t safely designed. The complaint follows earlier suits against the company over an October crash in Indonesia involving the same model. A Boeing spokeswoman declined to comment on Thursday’s complaint in a federal court in Chicago.

“The subject accident occurred because, among other things, Boeing defectively designed a new flight control system for the Boeing 737 Max 8 that automatically and erroneously pushes the aircraft’s nose down, and because Boeing failed to warn of the defect,” according to the complaint.

Late on Thursday, flag-carrier airline Garuda Indonesia said it’s going ahead with plans to cancel a $4.8 billion order for 49 Max 8s. Still, Garuda is sticking with Boeing and has asked the manufacturer for different aircraft. In Vietnam, Bamboo Airways agreed to buy as many as 26 narrow-body jets from Airbus SE, just a month after saying it was considering ordering as many as 25 Boeing 737 Max planes.

Boeing is preparing to submit final paperwork to U.S. regulators for a software upgrade for an anti-stall countermeasure on the 737 Max that investigators said in a preliminary report repeatedly pushed the nose down on the Max operated by Lion Air. In that case, the jet went into a dive prior to crashing into the Java Sea in October.

Authorities are probing whether the system was a factor in the March 10 crash of the Ethiopian Airlines jet, which regulators said behaved similarly to the earlier downed plane.

Boeing faces the prospect of substantial payouts to the families of passengers if it’s found responsible for both the Indonesia and Ethiopia crashes. But legal experts say the second one could prove even more damaging for the company. That’s because plaintiffs will argue the manufacturer was put on notice by the earlier tragedy that there was something dangerously wrong with its planes that should have been fixed.

Steven C. Marks, the lawyer who filed Thursday’s complaint, criticized the certification process for the 737 Max 8, saying it amounted to an “amendment” of a 50-year-old model rather than a more rigorous approval process for a “new aircraft.”

"Boeing and the FAA knew about the dangers and they failed to ground the fleet," said Marks, who also is suing over the Lion Air crash. He said the similarities between the two accidents are “very clear.”

The single-aisle Max family is the Chicago-based planemaker’s largest seller and accounts for almost one-third of the company’s operating profit.

The crashes have put Boeing and the FAA under withering scrutiny, with multiple investigations being launched into the agency’s certification of the 737 Max and its reliance on FAA-designated company employees to certify the safety of many of the planes’ functions.

After the FAA grounded the 737 Max jets in the days following the Ethiopia crash, the manufacturer said it still has “full confidence” in the plane. Boeing Chief Executive Officer Dennis Muilenburg said the company was doing everything it could to understand the cause of the accidents, deploy safety enhancements and ensure that no more crashes happen.

Mission Shakti: India's anti-satellite test sends a stark message to China

One month after an ageing Indian Air Force jet was shot down in a dogfight with neighboring Pakistan, New Delhi has demneighbouring new weapons capability aimed at another, more powerful geopolitical rival: China.

On Wednesday, Prime Minister Narendra Modi used a national address to announce India had “established itself as a space power” by sending an indigenously designed ballistic-missile interceptor up 300 kilometers (190 miles) to destroy a satellite orbiting the Earth. The move -- with political overtones just weeks ahead of a national election -- sends a stark message to India’s nuclear-armed rivals, China and Pakistan, and changes Asia’s strategic calculus by proving India has the ability to knock out enemy satellites.

The development suggests India, which has long struggled with a lethargic military-procurement process and outdated defense technology, is getting closer to sitting alongside China, Russia and the U.S. as countries with the ability to disrupt enemy communications networks. The move comes weeks after India sparred with arch-foe Pakistan in the skies over Kashmir, a disputed border region where China also has territorial claims.

“Essentially, India is saying that we are a strong and capable military power -- it’s not specific to any one country, but it is a message to all of India’s adversaries,” said Ajey Lele, a retired Indian Air Force group captain who’s now a senior fellow at the Ministry of Defence-funded Institute for Defence Studies and Analyses. “If somebody wants to do something to our satellites, we have the capability to do this to your satellites.”

‘Exclusive Group’

India’s foreign ministry said in a statement that New Delhi wasn’t engaging in an arms race, but asserted that “with this test, India joins an exclusive group of space-faring nations consisting of USA, Russia and China.” Beijing’s growing space capability -- conducting a similar anti-satellite test 12 years ago -- has helped drive U.S. President Donald Trump’s efforts to build a “space force.”

“China is clearly part of the calculation,” said Rajeswari Pillai Rajagopalan, head of the nuclear and space policy initiative at New Delhi’s Observer Research Foundation, adding that a similar test by China in 2007 served as “a big wake-up call” to India. “It has a deterrence effect, and that is clearly a China-driven point that India wants to convey.”

India’s relations with China, which have been strained by a series of long-simmering border disputes, have grown more tense as the two rising powers jockey for influence across the region. Beijing has forged ever-closer military and economic ties with Islamabad, spurring New Delhi to improve relations with Washington.

China enjoys a big lead over its less-developed neighbor, becoming in January the first country to land a spacecraft on the far side of the Moon. Its space program is run by the military and Chinese President Xi Jinping established a Strategic Support Force in 2015 to develop greater capabilities.

John Blaxland, head of the Strategic & Defence Studies Centre at Australian National University, said the anti-satellite test nonetheless signaled that India was “stepping up to the plate” in space. “India’s neighbors will have to think twice before upping the ante in any future space clash, particularly once this capability matures,” Blaxland said.

The launch also delivers a message closer to home, especially after India’s recent Kashmir flare-up, which included Pakistan’s capture and release of a Indian pilot. Militarily, the move could be seen as demonstrating India’s ability to shoot down ballistic missiles from its rivals.

Politically, it showcases India’s industrial and military strength just weeks ahead a pivotal general election that could decide Modi’s political fate. The ruling Bharatiya Janata Party has leaned heavily on the prime minister’s authorization of Indian air strikes against Pakistan during recent appearances on the campaign trail.

“It gives Modi an opportunity to boast of his country’s technological prowess just before the elections,” said Sam Roggeveen, director of the International Security Program at Lowy Institute in Sydney.

Bigbasket turns unicorn with $150-mn funding; valuation jumps over twofold

In a major boost to the start-up ecosystem, two of India’s promising start-ups joined the elite unicorn club in a matter of one week.

Bigbasket, a leading online grocery delivery firm, has just sealed a Series F round at an estimated valuation of around $2.3 billion — over twofold jump, when compared with its last reported valuation of $950 million.

The Bengaluru-headquartered company has raised a total of $150 million (approximately Rs 1,000 crore) in this round, from new and existing investors, company filings sourced from business intelligence platform Paper.vc, showed.

The round was led by existing investor Alibaba, a Chinese e-commerce giant, while Seoul-based financial services group Mirae Asset, and CDC Group, a development finance group linked to the UK government, also participated.

While Mirae put in around $60 million, Alibaba pumped in around $50 million. CDC, which had earlier seen successful exits from online fashion platform Jabong, has put in $40 million into the round.

Alibaba had led a $300-million round in Bigbasket in early 2018.

“Following this Series F investment led by Alibaba, our estimate of the post-money valuation of Bigbasket is $2.28 billion.

We also believe that the company is likely raise more money as part of this financing round,” Vivek Duari, founder at Paper.vc, told Business Standard.

Hari Menon, the chief executive officer of the online grocer, could not be reached for comment.

Earlier this week, Delhivery, a Guruguam-based e-commerce-focused logistics start-up, saw its valuation topping $2 billion after Japanese telecom and internet conglomerate led a $413-million investment round through SoftBank Vision Fund.

The fresh capital is expected to provide Bigbasket the firepower to go deeper into the online grocery segment where competition seems to be intensifying. Earlier this month, Grofers announced closing $60 million from SoftBank, while marketplaces such as Amazon and Flipkart are also learnt to be doubling down on the grocery segment.

Started in 2011 by Hari Menon, V S Sudhakar, Vipul Parekh, Abhinay Choudhari, and V S Ramesh, who co-founded Fabmart.com in 1999, Bigbasket has already positioned itself as the largest grocery delivery firm. The company, which is also backed by investors such as Helion Ventures Partners, Bessemer Venture Partners, and International Finance Corp, now operates across 32 cities, with annual revenue of ~350-400 crore.

Grofers trails with Rs 150-200 crore annualised revenue, followed by Flipkart Supermart and Amazon Pantry, both of which have committed large investments to scale the grocery business.

Perfect disrupter: Rahul's' basic income promise may spell bad news for BJP

The main opposition Congress party’s promise to give sizable cash handouts to India’s poorest families if voted to power could re-energise its campaign to oust Prime Minister Narendra Modi at the general election starting in two weeks.

Modi’s ruling Bharatiya Janata Party (BJP) has held the advantage in the run-up to the election, boosted by a wave of nationalism after military clashes with old rival Pakistan last month. Pollsters say Congress may have pegged back some of that advantage with its announcement, but it was not clear to what extent.

Bhawesh Jha, founder of CNX, one of India’s largest polling companies, estimated that many voters in relatively poor and populous states including Rajasthan, Chhattisgarh and Madhya Pradesh - where Congress won power in local elections late last year - could be swayed by the handouts.

“Even if 4-5 per cent of voters go in favour of the Congress, it will be a big disaster for the BJP,” Jha told Reuters, adding that it would particularly help Congress where it is in a direct contest with the ruling party. “I think this could be a game changer.”

Early this month, an opinion poll by CNX and India TV estimated that the BJP alone could win 238 of 543 seats in India’s lower house, the Lok Sabha. Together with its allies, the party would have enough seats to form the next government, the poll said.

CNX has not published any poll since the Congress party announcement earlier this week that it would give 72,000 rupees ($1,045) each to 20 per cent of India’s poorest families, potentially benefiting 250 million of a population of 1.3 billion.

“This will definitely increase Congress’ vote share but at this stage it’s difficult to know how many parliamentary seats it would get,” Jha said.

Weak job growth and falling farm incomes have hurt the BJP, which romped to power at the last election in 2014 with 282 seats in parliament. This year, it has tried to keep the focus on its national security achievements and its promise of a muscular approach to Pakistan and home-grown militancy.

On Wednesday, Modi announced India had successfully tested an anti-satellite missile, hailing it as a major breakthrough in its space programme.

DISRUPTOR OR BLUFF?

Yashwant Deshmukh, the founder of polling agency CVoter, described the Congress announcement as a “perfect disruptor.”

“These are the things that can reboot a campaign,” he told Reuters. But he warned that Congress needed to convince voters that the plan would be implemented if it came to power.

A CVoter opinion poll released this week, also before the announcement, estimated that the BJP and its current allies could get 261 seats, while the Congress alliance could win 143 seats.

The BJP has dismissed the plan as a “bluff.”

“No political party has betrayed India for more than seven decades other than the Congress Party,” Finance Minister Arun Jaitley said in a Facebook post. “It gave to the people of India many slogans and very little resources to implement them.”

Several farmers welcomed the Congress proposal, announced by its president Rahul Gandhi, which entails a monthly payment of 6,000 rupees every month to families earning less than 12,000 rupees.

“Farmers in poorer parts of the country tend to grow crops for their own consumption as they can’t afford to buy food stuff from the open market,” said Ram Kishan Yadav from Ramgarh in Jharkhand.

“For them a stipend of 6,000 rupees a month is like a big boon and it will eventually boost the flow of cash in the rural economy.”

About 70 per cent of India’s people live in towns and villages in the countryside.

Some farmers, however, expressed reservations.

“Rahul Gandhi’s promise looks good but it will work only if they convince people that they will keep their promise,” said Bharat Pujari, from Subarnapur in Odisha.

Pujari, who owns six acres of land, said Congress’ organisation in his region was weak, which may hinder the announcement from reaching some voters.

“Many people do not know about this announcement. Even if they know, they don’t trust him (Gandhi),” he said

Arun Jaitley to present Business Standard Annual Awards today

Finance Minister Arun Jaitley will present the Business Standard Annual Awards in the presence of top India Inc leaders and senior government officials who will gather at the ITC Maurya in New Delhi on Friday to celebrate excellence in the corporate, banking and social sectors.

This year’s awards will be given to outstanding organisations and individuals who took their respective fields of operations to newer heights while delivering on scale, sustainability, leadership, and innovation. They were chosen by three separate juries comprising some of the most respected names in India Inc. While the corporate excellence awards were chosen by a jury led by Aditya Birla Group Chairman Kumar Mangalam Birla, the Banker of the Year was selected by a jury led by former Reserve Bank of India deputy governor S S Mundra. The CSR awards were chosen by a jury headed by Tata Institute of Social Sciences Chairman S Ramadorai.

The jury chose Ashok Leyland Managing Director and CEO Vinod K Dasari the CEO of the Year for drafting the company’s growth strategy and focusing on three verticals to address the cyclical challenges of the trucking business.

He introduced new products and focused on light commercial vehicles and built a strong intermediate commercial vehicle franchise, all of which led to its market share increasing from 12-14 per cent four years ago to around 25 per cent.

chart One of India’s oldest success stories of foreign investment, Hindustan Unilever (HUL) has changed the way Indians go about in their daily life – ranging from home care, beauty and personal care, to foods and refreshments. HUL’s hard work was recognised by the jury, which awarded it the Company of the Year. The Unilever subsidiary stands miles ahead of formidable global and home-grown challengers such as Procter & Gamble and Patanjali Ayurved, and with the GlaxoSmithKline Consumer acquisition, it will become a leader in the health and wellness segment too.

The jury discussed several outstanding individuals who have left a deep and lasting impact on India’s corporate history, but quickly decided on Godrej Group Chairman Adi Godrej as the winner of the Lifetime Achievement award. The Banker of the Year award would be presented to IndusInd Bank MD and CEO Romesh Sobti.

Power Grid Corporation won the Star PSU of the Year award. Honeywell Automation India was declared the Star MNC of the Year, while Jamna Auto bagged the Star SME of the Year.

Foodtech player Swiggy was chosen the Start-Up of the Year.

The Social Entrepreneur of the Year award was jointly won by Katha founder Geeta Dharmarajan and Srijan founder Ved Arya. Srijan is a rural development initiative that relies on collaboration between the government, citizen organisations, donor agencies, and private businesses. A hybrid organisation, it works both as a consulting firm and a grassroots development agency, involved at every level — from design, to staffing and resource management, to implementation in the field.

Dharmarajan wanted to solve the problem of children dropping out of school not because their parents could not afford to send them but because they did not find it interesting enough. Katha makes learning fun and meaningful with Dharmarajan’s trademark story-pedagogy. Today, it works with 700 municipal schools in New Delhi.

Piramal Enterprises was chosen as the Socially Aware Corporate of the Year. The company’s targeted and hugely impactful work in Araku Valley in Andhra Pradesh towards improving the healthcare facilities for tribal communities was appreciated by the jury. The Social Enterprise of the Year award was won by Naz Foundation, which was founded by Anjali Gopalan in 1994 with a focus on gender, sexuality and providing care and support to children and people living with HIV/AIDS. Its women empowerment programme, which imparts life skills to adolescent girls to access their rights using sports, has grown from 70 girls to 90,000 today.

Delhi cops register case against Fortis' Singh brothers for siphoning funds

“Internal inquiries showed that poor financial health of Religare Finvest was to a large extent on account of wilful default on significant unsecured loans, defined for internal purposes as corporate loan book by borrower entities either related, controlled or associated with the promoters,” Religare Finvest said in the FIR.

The loans, the company said, were given at a non-arms-length basis, which is in violation of corporate governance norms, as well as, other regulations for Non-Banking Financial Companies prescribed by the Reserve Bank of India. In the complaint, Religare Finvest has also said that the Singh brothers and others had cheated the company through misappropriation, siphoning and diversion of funds through a labyrinth of financial transactions. Calling it a “well thought out and organised criminal conspiracy by which a financial scam of huge magnitude has been effected” by the Malvinder, Shivinder and others, Religare Finvest said that they had also siphoned off funds from its parent REL.

REL had also filed a separate complaint against Singh brothers and Godhwani with the Ministry of Corporate Affairs under the Companies Act. REL had made the complaint with the EOW of Delhi Police following an observation made by the Delhi High Court. During a hearing on Daiichi Sankyo's plea for payment of Rs 3500 crore arbitration award due to them against the Singh brothers, Justice Rajiv Shakdher had observed that if REL was serious about the allegations of defrauding against the former promoters of the company, it should file a police complaint about the same.

Religare moved court, alleging that the Singh brothers, in their capacity as promoters of Religare Enterprises, had siphoned off money from the company by issuing non-convertible redeemable preference share (NCRPS) for themselves and later redeeming them. About Rs 425 crore had been siphoned off by the two brothers, Religare had said in its petition.

The relationship between the two brothers, which had been deteriorating for a while, took a plunge for the worst after allegations of fund diversion from the Fortis group came to light. The two brothers came to blows in December and accused each the other of physical assault.

Earlier, Shivinder had written a scathing letter, blaming his elder brother for the financial and legal troubles of Fortis group. Sources had, at the time, said that while Shivinder had offered to pay his share of the Rs 3500 crore award, Malvinder was not ready for the same and wanted to fight it out legally.

Mobile number portability requests at 9-month high of 5.9 million in Jan

The minimum recharge plans introduced by telecom operators Bharti Airtel and Vodafone Idea (VIL) to cut out low revenue subscribers and increase the base of high revenue customers are creating a churn in the market. Mobile number portability (MNP) requests were at a 9-month high of 5.9 million in January, according to data shared by Telecom Regulatory Authority of India (Trai).

Analysts suggest that subscribers are moving to their primary SIM card as a reaction to the minimum recharge plans. "MNP requests have been stable in metros, while A, B and C-circle markets have seen a sharp pick up. We expect requests to rise further in subsequent months as more subscribers choose their primary mobile operator,” writes Deepti Chaturvedi, Research analyst, CLSA in a note to investors.

Total number of MNP requests increased from 411.98 million at the end of December 2018 to 417.82 million at the end of January 2019. In April 2018, 6.73 million subscribers made MNP requests around the time Reliance Jio introduced a large number of new data bundle plans.

The highest number of requests have been received in Karnataka (about 39.18 million) followed by Tamil Nadu (about 35.56 million).

A study by UBS Evidence Labs has revealed that ownership of multiple SIM cards has declined from 1.33 times to 1.22 times in nine months across 13 cities, setting the stage for rationalisation of competition. On a bright note for telcos, while Jio still leads on customer satisfaction in the metro cities, Bharti Airtel and VIL are catching up in the non-metros.

In what may be a positive news for both Jio, Airtel and VIL, users are increasingly using Jio for voice calls, while Airtel and VIL users are using more data. Trai numbers show that active subscriber growth base of Jio slowed down in January, possibly hinting toawrds a slower adoption of the JioPhone.

"Bharti has managed to improve its share of smartphone users, with an increasing proportion of Airtel subscribers using its SIM for data. Jio's momentum remains strong in both smartphone and JioPhone segment, although VIL's share of smartphone subscribers is declining,” say UBS analysts Navin Killa and Amit Rustagi.

The UBS survey also suggests that multiple SIM ownership is declining, which should set the stage for gradual stabilisation of competition and pricing environment. Trai data suggests Bharti's 4G net subscriber additions have picked up in past 3-4 months, while Jio has maintained a steady pace and VIL continues to struggle to build momentum.