Chamber Voice – February 2021

President's Note

Dear Members,

It’s no secret, these are tough economic times filled with uncertainty and doubt. But as we approach the end of the Financial Year 2020-2021, we believe that this is also a time of opportunity – a chance to stand out from the pack. 

We should all believe that our Businesses will find ways to stand the test of time and move ahead by devising, creating and following non-traversed ways to success. The Cochin Chamber is planning various initiatives to make sure that you are supported in your journey. While we appreciate inputs from members, we also encourage each of you to share your comments and suggestions to this effect. Eventually, the Chamber relies on the support from its members.

The last meeting of the CEO FORUM for the FY 20-21 will be held on Friday, 5th March 2021 at Taj Gateway, Marine Drive, Ernakulam. Dr. M. Beena I.A.S., Chairperson, Cochin Port Trust will address the Forum on the ‘Changing Indian Port Scenario – Impact on Cochin Port.” I hope you will take this opportunity to join us at the meeting and the deliberations thereafter.

The Chamber thanks you for having been a part of the CEO Forum of the Chamber and for participating in the monthly meetings during the past year. The Chamber is proud of the fact that it has completed 5 Editions of the CEO Forum Breakfast Meetings this year. It is your support that has contributed to the successful completion of the current edition of the CEO Forum Meetings. We trust that you have enjoyed being a part of this initiative of ours.   

As you already know, CEO Forum Meetings provide the participants the opportunity to address or discuss their concerns/issues. The Chamber has always been known for making strategic interventions at the appropriate forums at the Central and State Government levels at the policy making stage and many of our recommendations find its way into policy making.

The Sixth Edition of the CEO Forum – Breakfast Meetings will commence from the 3rd of April 2021.  We welcome you to register for the same. Letters are being sent out from the Secretariat in this regard. Mr. C.V.R. Rajendran, Managing Director & CEO, CSB Bank Limited has consented to be the Guest Speaker at the Inaugural Session of the 6th Edition of the CEO FORUM.

The Chamber had submitted a representation to the Hon’ble Finance Minister of India, Smt. Nirmala Sitharaman on certain provisions of the Finance Bill which relate to the Ease of Doing Business. The detailed representation can be accessed in this Newsletter for your reference.

The Chamber was also invited for an interaction with Member of Parliament, Shri. Shashi Tharoor in Kochi on Monday, 15th February 2021 as part of his efforts to gather ideas from the public. Mr. S.P. Kamath, Executive Director of Amalgam Group and the Executive Committee Member of the Cochin Chamber represented the Chamber at the meeting. He called for a clear policy on Land utilisation and suggested a review of the land utilisation policy which is hampering development in Kerala. The Chamber has also submitted a Representation to Shri. Tharoor seeking a certainty on Tax Laws for Ease of Doing Business. 

The Chamber during the month, submitted its views on the Discussion paper on “Revised Regulatory Framework for NBFCs” issued by the Reserve Bank of India.

The Chamber also represented to the Union Minister for Commerce and Industry, on behalf of a member to lift the export restrictions on certain diagnostic tools required for Covid testing as we are losing out to Chinese Companies due these restrictions. The Chamber urged that lifting the ban would enable Indian Companies to contribute their mite in the fight against the pandemic. 

On Wednesday, 17th February, 2021, our Executive Committee Member, Ms. Vinodini Isaac had the opportunity to have a one on one discussion with Sri. E.P. Jayarajan, Hon’ble Minister for Industries and Sports, Government of Kerala wherein a detailed representation on the Chamber’s suggestions on aspects like redrawing the Retail Policy was suggested .

The Chamber was also represented by our Research Associate, Mr. Arun P.S. at the meeting hosted by the Hon’ble Mayor of Kochi,  Adv. M. Anilkumar of the Kochi Municipal Corporation on the 26th of February 2021. The meeting was convened to deliberate the development agenda for the Corporation involving the key stakeholders in the City at the Corporation Office. Suggestion on these are welcome so that the same can be represented in future meetings.

The Chamber sought model guidelines for road/ward adoption to enable/instil confidence and clarity among interested stakeholders. We also suggested that a Smart City like website be developed where users can check the status of individual projects started by the Corporation. The Chamber also suggested the possibility of introducing Development Impact Bonds like that of the Pune Municipal Corporation.

I am also happy to state that Chamber’s opinion is sought more and more on issues which affect the trade and commerce in the State. The President represented the Chamber on a Panel discussion on the move by Karnataka to block the Roads due to high incidence of Covid in Kerala, in the Mathrubhumi Channel on 22nd February.

The Chamber is constantly taking up issues to ensure that the Ease of Doing Business becomes a reality at every level. Considering the serious impact that Covid-19 has had on the State’s economy, it is imperative that speedy measures are adopted to help revive the economy. 

K. Harikumar 

President

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Fine Points

New PF tax rules from April: How it will impact you

The salaried employees who use Voluntary Provident Fund to invest more than mandatory 12% of basic pay, will also be impacted by this new rule

Finance Minister Nirmala Sitharaman announced in Budget 2021 that interest on employee contributions to provident fund of over  ₹2.5 lakh per annum would be taxed, starting from 1 April. Up to ₹2.5 lakh has been kept as the deposit limit for which interest is tax exempt, the Finance Minister said. At least 12% of an employee’s basic salary and performance wages is compulsorily deducted as provident fund, while the employer contributes another 12%. As paying tax free interest on provident fund becomes more and more unsustainable, the government wants to curb high income earners from self-contributing more to their PF accounts, is the motive behind this move.

This change will affect the high-income earners and High Net-worth Individuals (HNIs). Anyone who earns more than ₹20.83 lakh a year will attract his or her interest on EPF contribution being taxed. The new provision only takes into account employees’ contribution and not the total contribution to the fund during any year.

“Under the existing tax provisions, interest received/accrued from employee’s provident fund (EPF) is exempt from tax. It is proposed that the interest earned on the EPF contributions (only employee contribution) above  ₹2.5 lakh a year will now be taxable.

The big-ticket money which comes into the fund and gets tax benefit as well as assured about 8% returns that would come under the tax ambit, the Finance Minister said.

The salaried employees who use Voluntary Provident Fund to invest more than mandatory 12% of basic pay, will also be impacted. A large tax free interest accrual which is not taxed on withdrawal either, is now being rationalised and will mostly impact the high income bracket.

India's recovery has entered the consolidation phase since January: ICRA

Synopsis: 

The annual performance of about nine of the 15 indicators tracked by ICRA weakened compared to the improvements seen in December on account of a fading of the favourable base effect, supply-side issues and price hikes.

India’s economic recovery has entered a consolidation phase during the first month of 2021, as the pace of improvement in a number of leading indicators slowed down compared to December, according to rating agency ICRA

The annual performance of about nine of the 15 indicators tracked by ICRA weakened compared to the improvements seen in December on account of a fading of the favourable base effect, supply-side issues and price hikes, the agency said in a report on Tuesday.

According to ICRA they do not construe the dip in volume performance of a majority of the lead indicators in January 2021 as a sign of alarm regarding the sustainability of the growth recovery. However, they do caution that the pace of underlying growth in the Indian economy remains subdued, and do not foresee a sharp ramp up in the pace of GDP expansion in Q4 FY2021.

Indicators like passenger vehicle (PV) sales, vehicle registrations and Coal India’s (CIL) output showed a year-on-year contraction, according to the agency, while year-on-year growth in petrol consumption, ports cargo traffic, generation of Goods and Services Tax e-way bills, bank credit and deposits for January was slower compared to the previous month.

On the other hand, six indicators including non-oil exports, electricity generation, rail freight traffic, scooter production, diesel consumption and domestic airline traffic showed improvements in January over their annual growth in December.

“The most meaningful appear to be the substantial improvement in growth of non-oil exports to 11.5% in January 2021 from 5.6% in December 2020, as well as the pick-up in electricity generation to 6.5% from 5.1%, respectively, which took place despite an unfavourable base effect.”

Based on this data, ICRA estimated the Index of Industrial Production growth to remain muted at 0.5-2% in January against 1% a month earlier.

The rating agency projected growth in the ongoing quarter at 2.6%, modestly building on the 0.7% growth it estimated for the third quarter of FY21.

Cues for growth

Only way to unlock value of PSUs is liberation from Government control. Growth will continue to be consumption-led

The Sensex tumbling below 50,000 points, after having scaled that psychological barrier earlier this month, is an occasion for reflection. Not the least because the stock markets’ relentless rise till now was itself seemingly incongruous with a stagnating, if not contracting, economy. Even after the recent fall, the benchmark index, a closing of 49,744 points, is over a fifth higher than at the start of 2020. It raises the question: What are the stocks that have gained from the just-ended bull run and what does it suggest for the broader economy? To start with, public sector undertaking (PSU) stocks were not part of the extended rally. The S&P BSE PSU index today is, in fact, below its January 1, 2020 level. Indian Oil Corporation is the country’s top company by revenues, but its current market capitalisation of Rs 90,046 crore is a fraction of Reliance Industries’ Rs 12,72,579 crore. There are only three PSUs, the market values of whose shares exceed Rs 1,00,000 crore: SBI, ONGC and Power Grid Corporation. Even SBI’s market cap is lower than that of HDFC Bank, ICICI Bank and Kotak Mahindra. The same goes for that of Power Grid or NTPC vis-à-vis Adani Green Energy.

The inference is simple: Being India’s biggest oil marketer, lender or power generator and transmitter might seem a big deal to many, but not to the markets that value performance more than size. PSUs are seen to deliver value not to shareholders — in this case, taxpayers — but to ministers and bureaucrats. While the markets aren’t always right, it’s clear that the only way to unlock the hidden value of PSUs is by liberating them from Government control. The latest Union Budget has referred to a new disinvestment policy that aims at privatising all PSUs and limiting them to a “bare minimum presence” even in so-called strategic sectors.

But it isn’t just PSU versus private. The markets are also valuing consumer-facing firms more than those in engineering and capital goods. Thus, the market cap of Hindustan Unilever (Rs 5,09,208 crore) or Asian Paints (Rs 2,28,975 crore) exceeds L&T’s (Rs 2,03,959 crore). Even more revealing are the numbers for Page Industries (Rs 30,739 crore) and Jubilant FoodWorks (Rs 41,089 crore), compared to SAIL (Rs 27,692 crore) and BHEL (Rs 13,824 crore). If the makers of Jockey innerwear and Domino’s pizza are valued more than steel and power equipment manufacturers, it points to two things. India’s growth will continue to be consumption- and not investment-led. Secondly, demonetisation, GST and lockdown may have killed the informal sector. But organised and branded product players have grabbed a bigger share of the pie, which itself has perhaps shrunk. The next market rally is likely to only consolidate these trends.

India's economy likely returned to growth last quarter

Synopsis:

The median forecast from a survey of 58 economists, conducted between Feb. 18-24, put year-on-year growth at 0.5% in the December quarter, as the economy stabilised after contracting 23.9% and 7.5% in April-June and July-Sept quarters respectively.

India’s economy is likely to have returned to growth in the December quarter due to the easing of restrictions on movement after the first wave of the coronavirus epidemic peaked, a Reuters poll predicted.

The median forecast from a survey of 58 economists, conducted between Feb. 18-24, put year-on-year growth at 0.5% in the December quarter, as the economy stabilised after contracting 23.9% and 7.5% in April-June and July-Sept quarters respectively.

“We forecast a mild expansion in the December quarter owing to strong resumption in economic activity, festival led consumer spending and modest recovery in manufacturing,” say economists at ANZ. “We believe services likely spearheaded growth.”

The previous poll, taken a month ago, had predicted a 2.0%contraction.

However, the wide range of forecasts in the latest poll – from a contraction of 4.7% to a 2.6% expansion – underscores the uncertainty.

India has reported the second highest number of coronavirus cases, lagging only behind the United States, but it is widely accepted that infections are far higher than officially recorded. The economic recovery has been aided by the Government’s spending plan and its commitment to not bring its fiscal deficit down to pre-pandemic levels for at least five years, and by the Reserve Bank of India‘s pledge to keep monetary policy accommodative.

“Pent-up goods demand supported by elevated financial savings have led to a rise in manufacturing. Alongside this, a strong pick-up in government spending on social welfare schemes and capital expenditure has also helped.”

The Central Bank slashed its key repo rate by 115 basis points last year and has since held it steady at 4%.

Liquidity normalisation is expected to be calibrated and incremental during the course of the year. No change is expected in the repo rate this year.

Minutes of the last RBI Monetary Policy Committee meeting showed optimism for a recovery, but concerns have increased about a second wave of infections and renewed lockdowns in a few areas in the state of Maharashtra, which accounts for about 16% of India’s economic output.

Recent Union Cabinet Decisions

Forthcoming Event

CEO FORUM 2021

Changing Indian Port Scenario - Impact on Cochin Port - 05.03.2021

The Cochin Chamber is pleased to inform you that the next Meeting of the CEO FORUM will be held on Friday, the 5th of March, 2021 at the Taj Gateway Hotel, Marine Drive, Ernakulam from 8.00 a.m. to 10.00 a.m.

The meeting will be followed by a Networking Breakfast. Dr. M Beena IAS, Chairperson, Cochin Port Trust, has graciously agreed to be the Guest Speaker for the upcoming meeting. She will speak on the “Changing Indian Port Scenario – Impact on Cochin Port” Rest assured that all safety measures will be adhered to in the conduct of the meeting.

Wearing of Masks and maintaining Social Distance is mandatory.

While there is no Registration Fee payable for those who have subscribed to the Breakfast Meeting series, we are constrained to charge a nominal fee of ₹600 (inclusive of GST) for the other participants.

We look forward to your participation and thank you in advance for the same.

Kindly click here to register for the event.

CEO FORUM 2021

The Chamber is proud of the fact that it has completed 5 Editions of the CEO Forum Breakfast Meetings this year. The 6th Edition is set to commence from the 3rd of April 2021.

We thank you for having been a part of the CEO Forum of the Chamber and for participating in the monthly meetings during the past year. It is your support that has contributed to the successful completion of the current edition of the CEO Forum Meetings. We trust that you have enjoyed being a part of this initiative of ours.

As you already know, CEO FORUM Meetings provide the participants the opportunity to address or discuss their concerns/issues. The Chamber has always been well known for making strategic interventions at the appropriate forums at the Central and State Government levels at the policy making stage and many of our recommendations find its way into policy making.

In the past we were privileged to have some distinguished speakers address us. They included people like Mr. Paul Antony I.A.S. former Chief Secretary, Government of Kerala,  Mr. Mohammed Hanish, I.A.S., Principal Secretary, Department of Industries and Commerce, Government of Kerala, Dr. V. Venu I.A.S., Principal Secretary, Department of Revenue and Disaster Management, Government of Kerala, Senior Advocate and former Addl. Solicitor General of India K.V. Viswanathan, Supreme Court of India, Mr. G Vijayaraghavan, Founder CEO – TechnoPark, Trivandrum and Former Member – Kerala State Planning Board, Dato Dr Jai Mohan, Adviser to Nichi-Asia Center for Stem Cell & Regenerative Medicine, Malaysia and Dr. M. Beena I.A.S., Chairperson, Cochin Port Trust among others.

Do subscribe/renew your membership of the CEO Forum for the year 2021-22.

We do hope that you will continue to be a part of this initiative of the Chamber in the coming year too.

We look forward to having you as a member of the CEO Forum in the coming year too.  Do register at the earliest by clicking here.

CCCI - Ease of Doing Business Information Survey

The Kerala Government has constituted a Committee of Secretaries vide Order dated 7th October 2020 as Phase 1 of exercising minimum regulatory compliance on businesses. The Cochin Chamber of Commerce & Industry wishes to contribute quality policy inputs to the Government to improve Ease of Doing Business in the State.

Questionnaire on Business Information Survey (click on the link given to view the same)

We request you to send your valuable inputs by filling the above Questionnaire and kindly co-operate with us.

Recent Events

CEO FORUM 2021

The Union Budget 2021 - Will it help to leave Covid behind? - 05.02.2021

The Cochin Chamber’s CEO FORUM Breakfast Meeting series, meant for the Business Leaders in Cochin recommenced on Friday, the 8th of January 2021 after a 10-month break brought about by the restrictions imposed on account of the Corona virus pandemic.

Mr. Kishor Rungta, Chairman & Managing Director, FACT Limited, was the Speaker at the Session. He spoke on the “Union Budget 2021 – Will it leave Covid behind?”

Mr. K. Harikumar, President of the Chamber delivered the Welcome Address and introduced the Speaker. In his address, the President highlighted the various activities the Chamber initiated in the month of January, which included the representations and the press releases the Chamber made during this time.

The President then invited Mr. Pradeep of PJ Law offices a new Member of the Chamber to address the Forum and introduce his organisation and its activities. Mr. Pradeep thanked the Chamber for the opportunity and briefly introduced himself and his firm to the participants.

Mr. Kishor Rungta commenced his address by thanking the Chamber for inviting him as the Guest Speaker at the CEO Forum meeting. He said that in just one year, the pandemic has affected all of us and have made changes to our lives in ways that none of us ever expected. With the lockdown and following restrictions, activities across all sectors were restricted. However, he said that he is amazed at how quickly everything is getting back to normalcy with the help of various Online Tools and the advances in the digital world. Mr. Rungta said that to his mind, handling the challenges thrown up by the pandemic is nothing but a crisis management exercise for any Organisation.

To the question as to whether the Union Budget 2021 will leave Corona behind, Mr. Rungta said that the Budget has provided for many of the critical issues that are the outcome of the pandemic. He said that while this is commendable the biggest development is the focus of the Budget on the vaccine and its roll out. The new Vaccine can be considered as the first step to leaving Corona behind and the second being the budget in which, the Government of India has allotted almost 35,000 Crores for the Vaccination, he said. Apart from this the Government has allocated, almost 2.24 Lakh Crores for the Health Sector which is also a highly appreciable. This move by the Government will also create a lot of new jobs, and help the economy to revive faster.

Mr. Rungta emphasised that in the year, 2019-2020, India’s GDP was growing at a rate of 4.2%, however, the impact of the Covid – 19 Pandemic was so bad that the GDP went down by almost 7.5% in 2020-21 and in the Second Quarter especially, it went down by 27%. During this time, the Fiscal Deficit went up to 9.5% as the Government was forced to borrow money to pump liquidity into the Economy, which is also a very alarming situation. But the latest Budget has projected that for the year 2021-22, India’s GDP along with inflation will grow by an astonishing 14.4% along with the decrease in the Fiscal Deficit to 6.8%, giving good indications for the coming year.

The Government has also pumped in a lot of money to keep the Demand and Supply situation in the Market buoyant. Apart from all of this, the Government has also introduced a 64,180 Crores Swasth Bharat Yojana, Health Scheme, which will be utilised over a period of 6 years. In this budget, there is an allotment of 1.1 Lakh Crore for the railways which is a welcome move. Compared to the previous Budgets, this time around Kerala has been given consideration by allotting 65,000 Crores for Road Infrastructure Developments and has also got special mentions for the Cochin Metro Rail Project’s phase 2 Mr. Rungta said concluding his address.

The President of the Chamber presented a Memento to Mr. Kishor Rungta.

Wrapping up the meeting, Mr P M Veeramani the Vice President of the Chamber delivered the Vote of Thanks.

Virtual Meeting

Leading in the VUCA World - 18.02.2021

The Cochin Chamber of Commerce & Industry along with Transformavens Training and Consulting conducted an online program titled “Leading in the VUCA World – The Military Paradigm of Navigating a VUCA Environment”. The Programme examined attributes of VUCA enabled and ready Entities, Teams and Leaders and explored some of the methods and techniques used in the military to create VUCA enabled and ready Entities, Teams and Leaders. It enunciated specific instances of how military leaders react to VUCA situations and the choices that they make.

VUCA stands for Volatility, Uncertainty, Complexity and Ambiguity. It is an environment; business or otherwise, where circumstances and situations evolve by the minute. Today as the world is coming to terms with dealing with a global pandemic and a new emerging normal, every organisation and its leadership is challenged. The increase in volatility, uncertainty, complexity, and ambiguity creates not only disruptions but also opportunities. It means that Businesses must seek new orientations and take a fresh approach to management. Only then can one guarantee positive results in changed circumstances of a post pandemic world.

In a VUCA world, the most important thing is to anticipate the future and to strengthen cooperation with innovative solutions. To successfully navigate the VUCA environment one has to be VUCA enabled and ready.

The willingness to engage in genuine cooperation and take on clear responsibilities is a basic prerequisite for VUCA enabled and ready entities. This is something that is ingrained in the basic fibre of the military worldwide. The skills and talents required to survive and thrive in a conflict zone are basically the same that managers could deploy in their office and business environment. This requires freedom, creativity, speed, flexibility and a culture that connects people with the organisation.

THE STAKEHOLDER MEETING ORGANIZED BY THE KOCHI MUNICIPAL CORPORATION

26.02.2021

The Kochi Municipal Corporation hosted a ‘stakeholder meeting’ at the Council Hall in the Corporation Office on the 26th February 2021 to deliberate the development agenda for the Corporation.

Besides the Chamber the meeting was attended by representatives from FICCI, the Indian Chamber of Commerce & Industry, CREDAI, the Merchants Chamber, the Merchants Associations, the Vyapari Vyavasayi Ekopana Samithi, the Indian Medical Association, the High Court’s Advocates Association, ICAI etc. who elaborated on their concerns and provided inputs for the development of ‘Brand Kochi.’

Inaugurating the Session, the Hon’ble Mayor Adv. M Anilkumar said that the purpose of the meeting is to provide awareness on the development projects undertaken by the Corporation and to facilitate a forum to enable participatory decision making. He promised that similar meetings will be held on a monthly basis to ensure regular dialogue.

The Mayor first introduced the HEAL project of the Corporation. The acronym stands for Health, Environment, Agriculture and Livelihood. To facilitate waste management, every house in the corporation will have bio-bins in the near future, he said. The byelaws will be amended to facilitate and fix rates of waste collection by intermediaries. NIT Calicut has been entrusted with a satellite survey project to improve the working of the Brahmapuram plant. The Corporation is planning to appoint 400 employees for mechanised cleaning of the city.

The Mayor then proposed the development of model roads within the Corporation limits. The model roads will be developed in such a way that street vendors are not allowed in these areas. Stretches near the Goshree Junction, St Theresa’s- Maharajas road etc. are in the pilot phase of the project, he said. The MG road will be developed in a similar way in the next phase. Every ward will have at least one model road. The Mayor sought the support from Organisations for the development and maintenance of these roads. The Mayor said that the Corporation would provide monetary support for the laying of the roads and requested the support of local associations for the maintenance of the renovated road stretches.

The Corporation has taken steps to ensure that no more canals will be constructed in the city without scientific studies. The Town Planning Committee will be constituted to utilise their expertise to address the frequent flooding in the city. The Collector, Mayor, Police, PWD etc. will meet every month to ensure better coordination among the different agencies. The Corporation has also decided to go ahead with the ‘master plan’ for Kochi, the Mayor informed the meeting.

Street vendor bylaws will be drafted in accordance with the provisions in the Street Vendors Act and Supreme Court directions. Street vendors will be allowed only in dedicated zones to ensure a clean and safe experience to the users. Licenses will be made mandatory to address security concerns.

The Corporation is planning to adopt the Municipal Bonds route for financing projects. If approved, the Kochi Corporation will be the first in the State to do so.

The Corporation is planning to launch a DTP (Detailed Town Plan) Scheme, a first in India if implemented. The four ends of the project are Marine drive, Cheranelloor Panchayat, Banerjee Road and the Lake. These towns will have dedicated housing, parks, playgrounds, roads etc.

The Building Tax collection process will be reformed shortly. E governance will be implemented within 6 months. Tenders to assess the tax data will be floated shortly.

The Corporation is planning to set up ₹ 10 food stalls in the Corporation limits. The Mayor requested Markets and Merchants Association to support the venture by finding place/land for the same.

The Corporation is also undertaking a Canal rejuvenation project that could boost the tourism prospects. Canal side property acquisition discussions are also in the pipeline.

Suggestions/responses from individuals and associations 

1)    Cochin Chamber of Commerce and Industry

Sought model guidelines for road/ward adoption to enable/instill confidence and clarity  

among interested stakeholders

Possibility of Smart City like website where users can check the status of individual projects started by the Corporation.

Possibility of Development Impact Bonds like Pune Municipal Corporation.

 Mayor’s response – Smart city is a small project. Easy for them to update people. Corporation will try to update the stakeholders about project progress on a monthly basis.

2)    High Courts Advocate Association – 

Improvement of the Krishna Iyer Square and the installation of a statue

Need for multi-level parking near the High Court

Possibility of a new road to the High Court from the Banerjee Road

3)    Hotels Association

Highlighted the various bureaucratic hurdles in securing licenses. Some authorities demand the land title documents for issuing licenses which in reality is not mandatory. The discretionary power to impose random fees should be curtailed. Quoted an example where a 100 seat hotel was charged 500 rupees and a 50 seat hotel was charged 1000 rupees.

Mayor’s response – Complaints can be registered with the Corporation immediately.

4)    Vyapari Samithi

Promised to support the 100m model road development of the Market Road.

Mayor’s response – appreciated and clarified that the support required is not monetary. There should be someone to take ownership for maintenance of the developed road. 

5)    Indian Medical Association

Promised to support development of the Stadium Link Road.

Offered TeleMedicine support to the Corporation with

6)    FICCI

Extended to support E Toilets in the Corporation limit and said that at least 1 toilet should be available for every 2 kms.

Best practices in waste management from Indore, Mysore etc. should be implemented.

Elevated parking network should be considered

7)    Indian Chamber of Commerce

Agreed to extend support some projects in West Kochi.

8)    Regional Sports Centre

Should prioritise open spaces.

Mayor’s response :

Education Committee of the Corporation to visit schools to assess the sports facilities. 

Mayors’ football trophy to be launched

Kochi Marathon to be re-introduced

9) Residents Association

Insisted that Residents Associations should be part of major projects to enable easy implementation.

Beggars should be rehabilitated with the help of welfare centres.

10) Hostels Association

Requested the Corporation to finalise an NOC format to allow smooth operations

11)ICAI

Proposed to submit study reports to increase Corporation’s income

New projects required

Mayor’s response – An app for complaints registration to be launched shortly.

Kochi to witness annual film festivals, dance festivals and music festivals. This along with the Biennale will shape Kochi’s future.

12) Hostels Association

Waste management should be prioritised

Jobs from waste should be a priority

Mayor’s response – It is already in the pipeline. Will be implemented shortly

13) CREDAI

Requested Corporation to speedup projects with land mapping.

14) Indian Institute of Architects

Plot reconstitution in DTP scheme

Assured support in development of projects

15) Tourist Guides Association

Need for promotion of ‘Brand Kochi’

Mayor’s response-

Signature food court to come up shortly

A proposal to set up a project near Mangalavanam that portrays Kochi culture, food, art etc.

The Meeting concluded at 12.30 p.m.

Member Profile

LAKSHMIKUMARAN & SRIDHARAN

The Firm: Founded by V. Lakshmikumaran and V. Sridharan in 1985, Lakshmikumaran & Sridharan is a leading full-service Indian law firm with approximately 400 fee-earners across its offices in 14 Indian cities. Members of the firm hold advanced degrees in law, business, science & technology, commerce and accountancy from leading institutions in India and abroad and include bureaucrats, scientists, jurists and accountants. The keywords that resonate with every member of firm and the work they do are Integrity, Knowledge, Passion and Humility. The firm believes in technology as a driver for legal services in the future and hence, invests heavily in technology and infrastructure, which allows the professionals and clients to work more efficiently, collaborate effectively and maintain standards.

Over the last 35 years, the firm has worked with over 15,500 clients which range from start-ups, small & medium enterprises, to large Indian corporates and multinational companies. The team has been involved in assignments across diverse industries like automobiles, medical devices, pharmaceuticals, chemicals, financial services, power generation, manufacturing, shipping, broadcasting, FMCG, aviation, travel and hospitality, education, electronics, telecommunications, IT and ITeS, real estate, healthcare and modern sectors such as e-commerce, big data, renewables, gaming, , cement, cable manufacturing and sports. The firm serves over 45% of India’s largest companies (top 100 NSE companies based on market capitalization and has worked with various clients in India and international markets such as Japan, China, Korea, Singapore, USA, the European Union (EU), Middle East, Africa, South America, South-east Asia etc.

As market-leading thought leaders, the Lakshmikumaran & Sridharan team has authored various articles in leading national and international legal magazines. The practice and its practice leaders have regularly been quoted in various reputable national newspapers, publications etc.

International Desk: The firm has a focused International desk which comprises of dual-qualified lawyers (India and US/Europe mostly) with expertise across practice areas such as cross border M&As and investments, anti-trust / competition law, international trade law and international commercial arbitration. These attorneys have significant experience in advising clients on Indian laws across multiple jurisdictions such as US, UK, Italy, Germany, Japan, Singapore, Korea, China, Australia, Middle East, Africa etc.

Practice Areas: Arbitration, Aviation, Banking & finance, Commercial litigation, Competition/Antitrust, Corporate, M&A and PE, Customs, Data protection & Technology, Direct Tax, Goods & Services tax, Insolvency, International trade & WTO, IPR, Employment, Real estate and Regulatory

Office Locations: The firm has offices in- New Delhi, Mumbai, Bengaluru, Chennai, Hyderabad, Ahmedabad, Kolkata, Pune, Gurugram, Chandigarh, Allahabad (Prayagraj), Kochi, Jaipur and Nagpur.

The Kochi office of L&S, which was inaugurated on 15.11.2019, was its 12th office in India and was opened in pursuance of the firm policy to ensure physical presence close to the clients in major commercial hubs outside Metros, in tandem with the fast pace expansion of business areas in the Country.

Chamber Representations

REPRESENTATION BEFORE HON. FINANCE MINISTER ON CERTAIN PROVISIONS OF THE FINANCE BILL 2021

REPRESENTATION TO HON’BLE UNION MINISTER OF COMMERCE & INDUSTRY

Discussion Paper on Revised Regulatory Framework for NBFCs - A Scale-Based Approach

Chamber in the News....

Article

Health Data Protection in India

Prashanth Shivadass – Founder &

Shradha Rajgiri – Associate,

Shivadass and Shivadass (Law Chambers), Bangalore

Alvin Tofler describes the ‘digital era’ as the ‘Information Age’.  Information, knowledge and high-end technology are essential for the development and success of companies, which thrive in this digital era. Information, therefore, is an extremely valuable asset and is a currency in this highly globalised market.

In this regard, and in so far as ‘health data’ is concerned, India introduced the draft Digital Information Security in Healthcare Act 2018 (‘DISHA’) for the protection of digital health data of citizens, which combined with the Personal Data Protection Bill, 2019 (‘PDP Bill, 2019’), increases the odds of a very good healthcare protection system (in terms of data) in India.

There is a popular trend amongst people to group every technological advancement in the field of healthcare under the heading of “Digital Health”. The question that arises herein is – what is Digital Health?

The World Health Organisation (‘WHO’) defines digital health as “a broad umbrella term encompassing eHealth, as well as emerging areas, such as the use of advanced computing sciences in ‘big data’, genomics and artificial intelligence.”

Currently, any type of collection, receipt, storage, handling and transfer of sensitive personal data or information in any electronic form is subject to the Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules 2011 (‘SPD Rules’) under the Information Technology Act, 2000 (‘IT Act’). In the field of healthcare, this includes information relating to physical, physiological and mental health conditions, sexual orientation as well as any medical records and medical history.

With the Novel Coronavirus pandemic (‘COVID-19’) spreading over millions in Indian and across the globe, some states in India published an online database of infected people. Critics have stated that this will impact the privacy of the individuals.

While the SPD Rules was a huge step towards ensuring protection of electronic data at a time when it was not regulated at all, the need for higher threshold for protection has been felt over years, especially when it comes to sensitive personal data, i.e. sensitive health information. While the Government has, at various instances, encouraged the healthcare industry to adopt to a uniform health information database/ system, not much has happened in this sphere.

One of the foremost issues in so far as the healthcare sector is concerned is the lack of infrastructure, computing systems, coordination between hospitals, clinics and diagnostic centres. DISHA was an attempt to provide better healthcare information security in a way that the public could claim a right to ensure the smooth flow of electronic health data between organisations.

A full scale rollout of the proposed National Digital Health Mission (‘NDHM’), announced on August 15, 2020 by Prime Minister of India, would provide for Health IDs for every citizen of the country, containing their medical history, personal health, electronic medical records, diagnosis and other relevant data to inform better health treatment. These health IDs can be linked with one’s AADHAR or mobile number and would help the Central and State governments target the people who require the welfare schemes of these governments.

GENERAL CONCERNS

There are many concerns relating to the disclosure of such private health information. One of the main concerns of Health Data Management Policy, 2020, (‘Policy’) is the process by which data can be collected, stored and accessed on many levels so as to maximise the efficiency of data that can be utilised in times of need, as well as maintain the privacy of the patient and their personal information. While, the policy has been termed to be revolutionary towards the Digital India vision of the government, it has also been claimed to be a need in the face of the recent pandemic crisis.

The PDP Bill, 2019 aims to ensure smooth flow of personal health data while ensuring standards of security and privacy with respect to the data so collected. Paragraph 3 of the Policy stipulates that safeguarding the personal data is one of the key objectives. However, the provisions contained therein do not seem to be in line with the set objectives. The same is established from the fact that this Policy does not establish any relation between specific instances of data breach/ data leakage that may take place during the different stages of data collection, management and corresponding punitive measures.

For instance, ‘Health IDs’ can be generated by providing the AADHAR card number or “any other document of identification” under paragraph 15.2 of the Policy. It is pertinent to note that the AADHAR could not have been used as a document for identification of a Health ID, as per the judgement of the Supreme Court in K.S. Puttaswamy v. Union of India. The scope of AADHAR was diluted through this verdict. Given the above, this Policy will operate in the absence of a robust legislation governing personal data as India’s PDP Bill, 2019, is currently pending before the standing committee of the Parliament.

The Policy also states that the data especially, sensitive personal data (health data) needs to be shared with a Central Agency setup by the Central Government for the purposes of general welfare. In this regard, a lot of sensitive personal data is collected by companies which include health identity data. Before sharing such data with any other agency or the government, there needs to be a defined set of parameters as to what needs to be exchanged. The draw back in today’s date in the health care industry is that there are only guidelines (and no standards) as to the kind of data that has to be shared and to what extent. There is a set of data that goes into the government repository which is used to understand the demographics of the patient which include their illness and its diagnosis and treatment protocol. This kind of sharing helps in unifying the treatment protocol because each and every state forum has different treatment protocol for different illness, thus for that purpose having shared this data will benefit to respond to a crisis situation or having a uniform treatment process.

The other concern is if data is collected for the purposes of creating a health ecosystem, can this be monetised? In this regard, for safeguarding the health data given by the patients, the Indian and the European governments are putting efforts for exchange of data in the digital form. As it is not always possible to do a government funded research or a free research, there will be instances where the data needs to be shared with third parties for conducting research and attaining results which will require some kind of consideration to be paid. The entire process of collecting, storing and sharing externally will be justified when the government regulatory systems are in place.

The third major concern is if the Policy violates a citizen’s fundamental right of privacy by collecting the personal information under the garb of health. To this end, the Policy has been derived from the personal data protection regime. The information collected consists of personal data that is sensitive in nature and includes all demographic features, religious beliefs, gender, sex life, caste, etc., where several aspects are covered. However, there is a need for the  government should explain the inter-relationship between all the data and why it is being collected. Critics have therefore argued that formulating a policy basis a draft law is quite bizarre.

Lastly, a question does arise as to how hospitals or institutions ensure a secure relationship between pharmacists, doctor and patient, given that the information of the data principal (patient) must be disclosed to all parties.

There are two (2) perspectives to this:

First – the data that gets collected in the central repository is in terms of a provider level i.e., data principal. At the provider level, the hospital management ensures that there are strict access controls, cyber security practices, adherence to standards, segregation of duties at various levels based on who is working at different level. They are set to protect the patient’s confidentiality. Example, a pharmacist who is giving the medicines, can only see the brand which the doctor has prescribed and no other data that is there in the system. Thus, it is ensured that the circle of confidentiality is preserved from a provider’s point of view.

Second – with respect to the central agency who is collecting all these records, it needs to be understood that it is important for the data principal to understand the extent to which the data is collected, which are the entities with whom the data is being shared and the purpose for which it is collected. Once, this information is known it becomes easier on the part of the data principal to maintain and segregate the information or data collected and storing in the manner required by the agency. The Policy however, needs to clarify the purpose limitation, time limitation, encryption and decryption. A clear cyber security framework also needs to be settled so that confidentiality is protected and taken care off. Additionally, at the time of consent, the data principal needs to be informed about the terms and conditions of the data entry and the relation he / she holds or will hold with the doctor and pharmacists.

INTERNATIONAL PRACTICES AND REFERENCES

A) The United States of America

There is no explicit inclusion of the ‘right to privacy’ enshrined in the US Constitution, but there have been many overlapping legislations protecting and regulating the collection and use of personal information. At the federal level, there is still no formal legislation.

The Health Insurance Portability and Accountability Act, 1996 (‘HIPAA’) and the Health Information Technology for Economic and Clinical Health Act, 2009 (‘HITECH’) are the rules which govern the health information and health related personal data of Americans.

HIPAA is a federal law that required the creation of national standards to protect sensitive patient health information from being disclosed even without the patient’s consent or knowledge. Healthcare providers, health plans, healthcare clearing houses, business associates, etc., are covered and are subject to the Privacy of Individually Identifiable Health Information (‘Privacy Rule’). These entities shall not use and disclose protected health information without an individual’s authorization. While the Privacy Rule safeguards protected health information, the Security Rule, which applies to ‘electronic protected health information’,+ protects a subset of information covered by the Privacy Rule.

The two acts – HIPAA and HITECH are the primary health privacy and security laws in the United States. However, there are many provisions which are subject to criticism due to many provisions not being in consonance with the objective of the act. Both these acts only apply to organizations and entities which fall under the definition of a ‘covered entity’. Covered entity is understood as any entity that falls within the ambit of a health plan, a healthcare clearing house and a health care provider, capable of transmitting personal health information in an electronic form. Due to the lack of simplicity and awareness about these acts and the provisions enshrined under them, the consumers have no knowledge about their personal health information, manner of their data being stored and used, etc. thereby causing more harm to the healthcare system.

However, even with all their flaws, these separate legislations have been revolutionary in securing health data and ensuring efficient data collection, to transfer and use such data in critical times.

B) European Union (EU)

The General Data Protection Regulation (‘GDPR’) has been effective since May 25, 2018. The GDPR ensures transparency, consent, accountability, data privacy and security as well as individual rights. Essentially, GDPR focusses on personal data in so far as collection, storage and processing an individual’s data within the European Union. GDPR includes ‘privacy by design’ and prohibition of discriminatory profiling. These remain relevant and applicable to health data as well, which also have specific safeguards for personal health data.

Data Processors and Data Controllers must respect the rights of the Data Subjects, as per GDPR such as:

  • Consent for personal data to be shared and processed.
  • Access to personal data
  • Right to be forgotten
  • Right to portability
  • Right to rectification
  • Object to processing of their personal data.

These are more or less similar to the provisions of the PDP Bill, 2019. India has essentially borrowed the principles from the GDPR and the EU regime.

CONCLUSION

The Digital Health market has just started to flourish. Even though it is a road less travelled and an unexplored market, it certainly does present itself with many opportunities, but with every opportunity there is a risk element involved. Innovation may suffer due to the current nature of the policy and the fact that there is no overarching data protection regime in India.

The first challenge is to find a balance between preserving an individual’s privacy, inviolability of confidentiality and free development of personality and not hampering the development of new technologies and innovative initiatives. The second challenge is that since data is abstract fluid and can easily be transferred from one side of the world to the other, it involves guaranteeing that all the parties to the same piece of data chain are processing the data in consensus with one or more data protection laws. It is important to consider creating new regulating tools that would make it easily detectable in cases of data breaches and leakage and also to maintain control over the processing of such sensitive data by third parties, controllers and processors. In this context, the federalist system of legislation as adopted by the United States and the deviation mechanism and principles adopted by the European Union through GDPR has been instrumental in bringing in interpretation conflict in connection to  this matter.

In India, where access to affordable and standard healthcare is still a major concern for most, the public stands to gain a lot from the development of the Digital Health industry. With the public interest in the minds of both the regulators and the innovators, it can only be hoped that the developing legal and regulatory framework relating to the healthcare industry wont impede innovation or ignite misuse of the same. There is a long way to go in striking the right balance between data privacy and development in this field, however the same can be achieved by having the right outlook and support from all the stakeholders involved.

Fine Points

Fine Points

From the Research Wing.....

  1. The Chamber is preparing a submission on the Draft National Blue Economy Policy 2021. Members are requested to submit their inputs to arun@cochinchamber.org before 27th February 2021.
  2. The Chamber is preparing a Vision Document to engage the next elected government for reforms in Kerala. Members are requested to submit their inputs to arun@cochinchamber.org before 31st March 2021.

POLICY DEVELOPMENTS CORNER

  1. The Union Budget 2021-22 was tabled in Parliament on 1st February 2021. The Budget documents are available at https://www.indiabudget.gov.in/ .
  2. The Ministry of Earth Sciences (Govt. of India) has invited comments on Draft National Blue Economy Policy 2021. Deadline: 27th February (Released on 17th February ) Contact id: blueeconomy-policy@gov.in
  3. SEBI circulated a Consultation Paper on introduction of provisions relating to appointment or re-appointment of persons who fail to get elected as Whole-time directors or Managing Directors at the General Meeting of a listed entity.
  4. Important bills listed for introduction, consideration and passing in the Budget Session of Parliament.

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