APPLE Inc supplier Foxconn restarted production at its plant in southern India on Wednesday (12), more than three weeks after it was closed because of protests over workers falling sick.
An official of the company said on condition of anonymity that the factory reopened with one shift and 120 workers and it would take more than two months for the plant to produce at full capacity.
Located in the town of Sriperumbudur near the Tamil Nadu state capital of Chennai, the plant employs about 17,000 people but was closed on December 18 after 250 workers fell sick with food poisoning, sparking protests.
Workers previously said the plant generally operates three shifts.
Apple had said on Monday (10) that the plant remained on probation and that it would continue monitoring conditions at workers' dormitories and dining halls, along with independent auditors.
Foxconn did not immediately respond to an email seeking comment.
Apple and Foxconn had previously found some worker dormitories and dining rooms did not meet required standards, forcing the Taiwan-based company to restructure its local management team and take immediate steps to improve facilities.
Women who assembled iPhones at the plant said they lived in crowded dorms without flush toilets and food served at worker hostels sometimes crawled with worms.
The factory, which has started trial production of iPhone 13, is strategically important in the long term as the US tech giant tries to cut its reliance on its Chinese supply chain amid trade tensions between Washington and Beijing.
(Reuters)
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Bangladesh seeks renegotiation of Adani Power deal: Report
Dec 19, 2024
BANGLADESH's interim government has accused Adani Power, an energy company controlled by Indian billionaire Gautam Adani, of breaching a multi-billion-pound agreement by withholding tax benefits granted to a power plant central to the deal.
The agreement, signed in 2017, enabled Adani Power to supply electricity to Bangladesh from its coal-fired power plant in eastern India.
Dhaka now seeks to renegotiate the deal, which was awarded by then-prime minister Sheikh Hasina without a tender process.
Documents from Bangladesh's power agency and communications between the two parties reviewed by Reuters reveal that the deal costs Bangladesh significantly more than its other coal power agreements.
Since Adani Power began supplying electricity in July 2023, Bangladesh has fallen behind on payments and owes hundreds of millions of pounds for energy already delivered. However, the two sides disagree on the total amount owed.
Bangladesh’s de facto power minister, Muhammad Fouzul Kabir Khan, told Reuters the country could manage without the Adani supply due to increased domestic capacity, although some local power generators remain inactive.
Adani Power has not been accused of any wrongdoing in Bangladesh. The company stated it has adhered to its contractual obligations and denied receiving indications that Dhaka was reviewing the contract. Adani Group dismissed US allegations of bribery against its executives as "baseless."
Tax exemptions dispute
Adani Power’s Godda plant, designed to supply electricity to Bangladesh, operates on imported coal and benefits from tax exemptions under India's special economic zone policy.
According to the 2017 agreement and its implementation terms, Adani Power was obligated to inform Bangladesh of changes in the plant's tax status and pass on associated benefits.
Bangladesh Power Development Board (BPDB) officials said Adani Power did not comply with these terms. Letters sent to the company in September and October 2024 requested the remittance of tax benefits. BPDB estimates that passing on these benefits would save 0.28p per unit of power, potentially reducing costs by approximately £22.7 million for 2024.
The BPDB chairperson, Md Rezaul Karim, stated that savings from the tax benefits would form a crucial part of future discussions with Adani Power.
Review of the deal
Bangladesh’s interim government, led by Nobel laureate Muhammad Yunus, has appointed a panel to review major energy deals signed during Hasina’s tenure. The contract with Adani Power, described as "negotiated hastily" in a government white paper, has come under scrutiny following US bribery charges against Adani executives.
Adani Power halved its electricity supply to Bangladesh in October 2024, citing payment disputes. The company claims it is owed £714m, while BPDB contends the amount is closer to £516m. Payment delays have been exacerbated by Bangladesh's ongoing foreign currency shortage.
Discussions between the two sides are ongoing, with arbitration clauses in the agreement mandating dispute resolution in Singapore. Bangladesh’s next steps depend on the outcome of investigations ordered by its courts, according to Khan.
(With inputs from Reuters)
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Bank of England maintains interest rate amid inflation rise
Dec 19, 2024
THE BANK OF ENGLAND (BoE) on Thursday kept its key interest rate unchanged at 4.75 per cent, opting not to follow the US Federal Reserve's recent rate cut, as inflation in the UK sees an uptick.
"We've held interest rates today following the two cuts since the summer," BoE Governor Andrew Bailey said in a statement.
Bailey emphasised the importance of meeting the two per cent inflation target, saying, "We need to make sure we meet the two-percent inflation target on a sustained basis."
His comments came after UK annual inflation rose to 2.6 per cent, according to data released earlier this week.
The decision to hold rates contrasts with the US Federal Reserve, which cut borrowing costs by a quarter-point on Wednesday while signalling fewer rate reductions for the coming year.
Last week, the European Central Bank also reduced eurozone rates, while the Bank of Japan left its rates unchanged in an announcement on Thursday.
Chancellor Rachel Reeves expressed support for the BoE’s decision, acknowledging the challenges it poses for households.
"I know families are still struggling with high costs," Reeves said. "We want to put more money in the pockets of working people, but that is only possible if inflation is stable, and I fully back the Bank of England to achieve that."
Had the BoE opted to lower its rate, retail banks might have reduced borrowing costs, including on mortgages, potentially easing pressure on consumers.
(With inputs from Reuters)
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Starmer woos Indian business leaders in Downing Street summit
Dec 19, 2024
PRIME MINISTER Keir Starmer hosted a delegation of 13 Indian companies at 10 Downing Street in London on what the British government described as a “curated visit” to enhance the bilateral partnership and boost investment flows.
The visit on Wednesday (18) follows Starmer’s meeting with Indian prime minister Narendra Modi on the sidelines of the G20 Summit last month, when the leaders committed to take forward an “ambitious” UK-India Comprehensive Strategic Partnership with collaboration opportunities on economic growth, security and defence, technology, climate, health, and education.
According to a readout from the British High Commission in New Delhi, the Indian investors and CEOs also met senior Cabinet ministers to discuss job creation and growth opportunities under a proposed India-UK trade deal after Starmer had confirmed the relaunch of Free Trade Agreement (FTA) negotiations early in the new year.
“India is a vital partner for the UK and we have huge ambition to unlock more opportunities together, building on our already strong relationship,” said Starmer, with reference to the business meeting.
“I’m delighted to welcome some of India’s most senior business leaders to Downing Street and to outline the UK’s ambitious focus on economic growth and innovation."
The delegation, supported by the Confederation of Indian Industry (CII), discussed deepening ties with chancellor Rachel Reeves and foreign secretary David Lammy. Meanwhile, business and trade secretary Jonathan Reynolds and minister for trade policy Douglas Alexander discussed bilateral trade, worth £42 billion a year and supporting over 600,000 jobs across both economies as per UK government statistics.
“As one of the most globally connected economies in the G20, the UK provides unmatched opportunities for Indian businesses to thrive. India already accounts for the second highest number of FDI projects into the UK, and this government is committed to deepening our trade and investment links with India even further,” said Reynolds.
“Boosting investment is a mission at the heart of this government. It was great to hear first-hand from Indian business leaders on why so many of them have given us a vote of confidence and chosen to invest here,” he said.
The companies represented are said to have collectively invested over £10bn into the UK and employ tens of thousands of people across the country. The delegation was led by Sunil Bharti Mittal, founder and chairman of Bharti Enterprises which completed a major investment in the BT Group this year.
“This business delegation comes at a pivotal moment, as India stands as the fastest-growing large economy and is on track to become a $5 trillion economy by 2027. Over time, India-UK relations have developed into a robust, multifaceted partnership built on historical ties, economic synergy, and increasing geopolitical alignment,” said Mittal.
“The India-UK Free Trade Agreement negotiations present significant opportunities for mutual growth and cooperation. We are optimistic that this delegation will pave the way for numerous successful business collaborations. We shall seek guidance from prime minister Starmer on the sectors that may exhibit better collaboration opportunities,” he said.
Other companies represented at the meeting included Bharat Semi Systems, Biocon Group, Blue Star Limited, Essar Group, Hero Enterprise, Jet Synthesis, Piramal Group, Reliance Industries, Tata Steel, TVS Motor Company, TVS Supply Chain Solutions and UPL Limited. The delegation concluded their tour with a reception hosted by the High Commission of India in London.
(PTI)
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Bank of England likely to hold interest rates at 4.75 per cent
Dec 19, 2024
THE BANK OF ENGLAND is expected to maintain its interest rate at 4.75 per cent on Thursday, even as the economy shows signs of slowing. Persistent inflation pressures are likely to prompt the central bank to stick to a "gradual" approach before reducing borrowing costs.
A Reuters poll of 71 economists unanimously predicted no change in rates for now. Most anticipate a quarter-point cut on 6 February, followed by three additional cuts by the end of 2025.
Financial markets, however, are less confident about the extent of rate cuts next year. Data released on Tuesday revealed an unexpected rise in wage growth, leading investors to price in only a 50 per cent chance of a rate cut in February and just two cuts by the end of 2025.
In contrast, the European Central Bank has already reduced rates by 1 percentage point this year and is expected to cut another point in 2025, responding to political and economic challenges in the eurozone.
The divergence in rate policies has widened the gap in yields between British and German 10-year government bonds to its largest since 1990.
The US Federal Reserve, which foresees only two rate cuts in 2024, reduced rates by a cumulative 1 percentage point on Wednesday—twice the pace of the Bank of England.
Bank of England governor Andrew Bailey recently reaffirmed the bank's stance, stating that "a gradual approach to removing policy restraint remains appropriate." The bank’s November forecasts showed inflation staying slightly above its 2 per cent target until 2027, based on expectations of four rate cuts next year.
Despite this, the Bank of England has not explicitly confirmed whether it considers this rate-cutting pace the most likely scenario. Economists expect the December policy statement to reiterate the emphasis on gradualism.
An 8-1 vote by the Monetary Policy Committee to hold rates steady is expected, with Swati Dhingra likely to dissent in favour of faster cuts.
Inflation and wage growth concerns
Inflation in Britain remains a key concern. After peaking at 11.1 per cent in October 2022, consumer price inflation fell below the 2 per cent target in September this year but rose to 2.6 per cent in November. This exceeded the Bank of England's forecast of 2.4 per cent and remains the highest rate among G7 economies.
Services price inflation, a metric closely monitored by the Bank of England for medium-term pressures, stayed at 5 per cent.
Meanwhile, wage growth reached 5.2 per cent in the three months to October, far above the 3 per cent level considered consistent with 2 per cent inflation by most Monetary Policy Committee members.
The Bank of England is also assessing the impact of chancellor Rachel Reeves’ decision to introduce an additional £25 billion in employment taxes. This could either lead to further price increases or result in job and pay cuts.
Business sentiment has declined since the budget announcement on 30 October, with economic output contracting for two consecutive months for the first time since 2020. However, economists say it is too early to determine if this slowdown will significantly ease inflation.
"We don't think there is enough in the data to shift the MPC from its cautious, gradual tone," said Cathal Kennedy, an economist at RBC. He added that new forecasts at the Bank of England’s February meeting would play a critical role.
(With inputs from Reuters)
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Tej Lalvani receives £15m dividend from Vitabiotics
Dec 18, 2024
VITABIOTICS , one of Britain’s leading health supplement companies, has rewarded its owner with a £15 million dividend in 2023, marking a 50 per cent increase over the previous year.
This decision follows a strong financial performance last year, with profits rising 9.5 per cent to £55.2m and sales climbing to £196.5m, according to newly released accounts.
The London-based company, founded in 1971 by Kartar Lalvani and now run by his son Tej Lalvani, is known for its iconic brands, including Wellman, Wellwoman, Pregnacare, and Wellbaby.
Since taking the helm as CEO in 2015, Tej Lalvani, a former Dragons’ Den panellist, has overseen a remarkable transformation, nearly doubling annual sales. The company also achieved record profits of £71m in 2021, boosted by pandemic-driven demand for online sales.
Vitabiotics has carved out a significant presence both in the UK and globally. While its domestic market remains strong, the company generates over half of its revenue overseas. China has emerged as its largest international market, with a 33 per cent sales increase last year, driven by strategic partnerships with influential live streamers and ecommerce platforms like Tmall, JD.com, Douyin, and Kuaishou. The company also expanded its presence in the Middle East and Far East, reinforcing its global footprint.
The UK’s food supplement market, valued at £20 billion, continues to grow, with 30 per cent of adults reportedly using supplements. Public health bodies like NICE recommend supplements such as folic acid for pregnant women and vitamin D for various groups, including children and the elderly. These endorsements, combined with growing health awareness, have contributed to market growth projections of up to 10 per cent annually over the next five years.
Vitabiotics has also gained visibility through high-profile advertising campaigns featuring celebrities like model David Gandy and TV host Tess Daly. With a workforce of 117, the company has become a household name, offering products tailored to different life stages and health needs.
Despite its success, the company’s ownership structure—registered offshore in the British Virgin Islands—has raised eyebrows, with £91 million in dividends paid out since 2020.
The Lalvani family was ranked 20th in Eastern Eye's Asian Rich List 2025 with an estimated wealth of £915m.
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