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  • Taiwan or China? Paraguay’s dilemma puts election race in the spotlight

    Taiwan or China? Paraguay’s dilemma puts election race in the spotlight

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    ASUNCION, April 24 (Reuters) – From Paraguayan capital Asuncion to Taipei and Washington, diplomats, officials – and farmers – are closely watching a tight election race that could determine Paraguay’s future ties with Taiwan.

    Paraguay will vote for its next president on April 30, choosing between a ruling party candidate pledging to extend decades-long diplomatic relations with Taiwan and an opposition rival who favors switching ties to China to boost the landlocked country’s farm-driven economy.

    Pressure inside the South American nation has been rising, especially from its powerful agricultural lobby, to flip ties to China and open up the Asian country’s lucrative markets to Paraguay’s soybeans and beef, its main exports.

    “We’re a food-producing nation that is not selling to the world’s biggest buyer of food,” Pedro Galli, the head of the Paraguayan Rural Association (ARP), told Reuters. His organization represents some 3,000 local farmers.

    Were Paraguay to recognize China it would be a blow to Taiwan, which is facing an uphill battle against Beijing’s economic muscle to keep its remaining 13 allies worldwide, and a fresh sign of China’s growing clout in an area Washington has long regarded as its backyard.

    Galli cited the recognition of China by other countries in the region, which in recent years have included Panama, the Dominican Republic, El Salvador and Nicaragua. Honduras was the latest to switch sides in March.

    “We’re watching the party from the balcony,” Galli said, referring to the loss the farming sector felt in terms of exports. “It’s just us and the Guatemalans left.” 

    Opposition candidate Efrain Alegre, who represents a center-left coalition, told Reuters in January and again in April that he would favor relations with China, the world’s largest beef and soybean importer, if elected president.

    “We are going to be where it is convenient, otherwise it would be a betrayal of the country,” Alegre told Reuters in the April 17 interview. “How can I deny a relationship that is beneficial for all Paraguayans, a people that need development, need investment, need industry?”

    The ruling conservative Colorado Party candidate, Santiago Peña, has vowed to stick with Taiwan. A cross-party delegation visited the island in February, seeking to calm Taiwanese jitters.

    Taipei, which argues that it provides economic support to its allies, said last week it was “perplexed” by the position taken by Paraguay’s opposition and it would do its utmost to maintain its diplomatic ties with the country.

    China has long argued that democratically-ruled Taiwan is part of its own territory with no right to state-to-state ties, a position Taipei strongly rejects. China demands that countries with which it has ties recognize its position.

    ‘WHEN, NOT IF’

    Among diplomatic circles in Asuncion there is a sense a switch is inevitable – regardless of the election outcome.

    “With Paraguay it is a matter of when, not if,” a senior European diplomat told Reuters, adding that given the pressures from the local business community and the fragile global economy, Paraguay could switch “within the next two years.”

    Even if the ruling Colorado party were to win the election, its leaders may not have the same staunch support for Taiwan as incumbent President Mario Abdo, whose father helped forge relations with Taiwan as a political aide over six decades ago.

    “We are brotherly peoples, and we have a destiny together,” Abdo said during February’s visit.

    “Current president Abdo had a strong personal commitment to Taiwan that goes back to his father,” said Evan Ellis, who specializes in China-Latin America relations at the U.S. Army War College Institute.

    “It is not clear that the same personal depth of ties is there with whoever takes over.”

    Opinion polls in April differed widely, with Atlas ranking pro-China Alegre narrowly ahead of Peña and Grau & Associated predicting a 16-point lead for Peña.

    Paraguayan rancher Fernando Serrati, who farms corn, soybeans and cattle, said the country was “trapped” in a diplomatic conflict hurting producers and exports, while the closed door to China meant it often lost a price premium.

    A severe drought that has hit regional farm production, poorer economic prospects globally, and war in Ukraine that has affected shipments of beef to sanctioned Russia have all further dented local sentiment, spurring more Paraguayans to favor new ties with China.

    “We need to consider the real interests of our country and open up to the world,” Serrati said.

    Reporting by Lucinda Elliott and Daniela Desantis; Editing by Adam Jourdan and Rosalba O’Brien

    Our Standards: The Thomson Reuters Trust Principles.

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  • California farmers flood their fields in order to save them

    California farmers flood their fields in order to save them

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    HELM, California, March 24 (Reuters) – When Don Cameron first intentionally flooded his central California farm in 2011, pumping excess stormwater onto his fields, fellow growers told him he was crazy.

    Today, California water experts see Cameron as a pioneer. His experiment to control flooding and replenish the ground water has become a model that policy makers say others should emulate.

    With the drought-stricken state suddenly inundated by a series of rainstorms, California’s outdated infrastructure has let much of the stormwater drain into the Pacific Ocean. Cameron estimated his operation is returning 8,000 to 9,000 acre-feet of water back to the ground monthly during this exceptionally wet year, from both rainwater and melted snowpack. That would be enough water for 16,000 to 18,000 urban households in a year.

    “When we started doing this, our neighbors thought we were absolutely crazy. Everyone we talked to thought we would kill the crop. And lo and behold, believe me, it turned out great,” said Cameron, vice president and general manager of Terra Nova Ranch, a 6,000-acre (2,400-hectare) farm growing wine grapes, almonds, walnuts, pistachios, olives and other crops in the San Joaquin Valley, the heart of California’s $50 billion agricultural industry.

    If more farmers would inundate their fields rather than divert precipitation into flood channels, that excess could seep underground and get stored for when drought conditions return.

    California swings between disastrous drought and raging floodwaters. This season has been especially rainy, with 12 atmospheric rivers pounding California since late December, placing greater importance on flood control. More wet weather is forecast in the coming week.

    Terra Nova’s basins are filled with 1.5 to 3.5 feet of water, Cameron said Wednesday. He plans to eventually flood 530 acres of pistachio trees and 150 acres of wine grapes plus another 350 acres that are planted only when excess floodwater is available.

    The state Department of Water Resources provided $5 million and Terra Nova another $8 million for the project, which includes a pumping system. So far there has been virtually zero return for the company, Cameron said, though it may acquire future water rights for its groundwater contributions.

    Cameron “is definitely what we call the godfather of on-farm recharge. He’s really the pioneer who began doing it first,” said Ashley Boren, CEO of Sustainable Conservation, an environmental group with a focus on supporting sustainable groundwater management.

    This mimicking of nature – letting water flow across the landscape – is the most cost-effective way to manage peak flood flows, experts say, while banking the surplus for drier days.

    “It’s not only going to benefit us, it will benefit our neighbors,” Cameron said.

    Cameron began his 30-year-old passion project before the state passed the Sustainable Groundwater Management Act (SGMA) of 2014, a law that sought to avoid a looming disaster from overdrafts.

    Since then, policy makers have worked on economic incentives for more farmers to follow suit. Some water districts that are responsible for implementing SGMA have offered growers credits toward water rights in exchange for recharge. Pending state legislation would simplify permitting and guarantee water rights for participating growers.

    California Governor Gavin Newsom signed an executive order on March 10 making it easier for farmers to divert floodwaters onto their lands until June.

    There is no statewide monitoring of on-farm recharge, but Sustainable Conservation is keeping track of four water districts in the San Joaquin Valley that recorded 260 farmers replenishing their aquifers this year, returning at least 50,000 acre-feet (61.7 million cubic meters) back into the ground as of mid-February.

    California, which has a strategic goal of adding 4 million acre-feet of storage, recently provided $260 million in grants to Groundwater Sustainability Agencies established under SGMA. The state received applications seeking $800 million, indicating demand for projects, said Paul Gosselin, deputy director of the state’s Sustainable Groundwater Management Office.

    Besides cost, growers face other obstacles to on-farm recharge. A farm must have access to the water, cannot hurt endangered species and cannot flood land subjected to certain fertilizers or pesticides or dairy farm waste.

    In the Merced River Watershed, willing farmers could recapture enough future floodwater to replace 31% of the groundwater they are overdrafting under existing conditions, said Daniel Mountjoy, director of resource stewardship for Sustainable Conservation, who participated in a state study. That could jump to 63% with changes in reservoir management and infrastructure improvements, he said.

    To achieve sustainability throughout the San Joaquin Valley, an estimated 750,000 to 1 million acres of irrigated farmland would have to be fallowed, Mountjoy said.

    “We’re at the beginning of a lot of momentum for groundwater recharge programs,” said Gosselin, of the state groundwater office. “The last two years (of extreme drought) was a wakeup call for everybody.”

    Reporting by Mike Blake in Helm and Daniel Trotta in Carlsbad, Calif. Editing by Donna Bryson and David Gregorio

    Our Standards: The Thomson Reuters Trust Principles.

    Michael Roy Blake

    Thomson Reuters

    Mike Blake is a senior photographer with Reuters and a member of the Pulitzer Prize winning team for Breaking News Photography in 2019. He began his career with Reuters in Toronto, Canada in 1985 and has traveled the World covering Olympic Games (18 in total) and World sporting events as well as breaking news and feature stories. Previously based in Vancouver and now Los Angeles, Blake attended Emily Carr College of Art and began his career making prints at a major daily newspaper. Blake grew up skateboarding and taking pictures and continues to do so now in his spare time.

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  • Indian truckers say Hindenburg report a godsend in Adani dispute

    Indian truckers say Hindenburg report a godsend in Adani dispute

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    • India’s Adani reopens two cement plants after freight dispute
    • Truckers believe Hindenburg report was answer to their prayers
    • Adani says amicable resolution reached after negotiations

    DARLAGHAT, India Feb 23 (Reuters) – For truckers transporting cement from Adani’s factories in a hilly north Indian state, a U.S. short-seller’s critical research report on the giant conglomerate was a godsend they say helped them save their livelihoods.

    For weeks, around 7,000 truck owners and drivers in India’s Himachal Pradesh resorted to protest rallies against Adani’s Dec. 15 decision to shut two cement plants over a dispute on freight rates. Adani argued the plants were “unviable” at the trucking rates it wanted to slash by around half.

    On Monday, the Gautam Adani-led group said it had “amicably resolved” the issue with a 10-12% reduction in rates. Truckers rejoiced, with a union leader in a street address labelling it as a victory after late-night talks with Adani.

    The settlement comes four weeks after U.S.-based Hindenburg Research accused Adani of stock manipulation and improper use of tax havens, allegations the group called baseless.

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    The Jan. 24 report triggered a $140 billion rout in group’s stocks, sparked regulatory investigations and saw the billionaire Adani slip to 26 on the Forbes global rich list, from third.

    While the truckers’ settlement will have only a small impact on the overall Adani empire, it was a big win for the drivers and owners in a state were most people live on around $7 a day.

    The report “played a crucial role in our battle against India’s biggest business group, helped mobilize truckers and gain political support,” said Ram Krishan Sharma, one of the lead negotiators for protesting truckers.

    Adani negotiators had refused to budge for weeks. So Hindenburg’s report, some truckers believe, was godsent.

    Just a day before it was published, many truckers visited a small, revered Hindu temple in Darlaghat which overlooks one of Adani’s cement plants, and offered a traditional semolina sweet offering to a deity as they sought to resolve the dispute.

    Bantu Shukla, a protest leader, showed Reuters a photo and video of truckers that day offering prayers inside the temple. Some stood with folded hands, while a person rang a temple bell in a typical Hindu worship ritual.

    ‘AMICABLE RESOLUTION’

    Adani Group did not answer Reuters questions on whether the Hindenburg report’s fallout contributed to its decision in Himachal.

    Adani Cements in a statement said it was “grateful” to all stakeholders including the unions, the local state chief minister and other departments, adding the “amicable resolution” was in interest of everyone including the state.

    A source familiar with Adani’s negotiation said the group had been under pressure following what it thinks was a “negative campaign” by Adani’s opponents after the Hindenburg report, and the settlement to reopen plants is a relief.

    Himachal is ruled by Prime Minister Narendra Modi’s staunch rival, the Congress party. After the Hindenburg report, Congress has renewed its claims that Modi for years has unduly favoured Adani. Both Adani and India’s government deny that.

    The source added the move will also help Adani signal it can resolve commercial matters in states ruled by Modi’s rivals.

    Without citing Hindenburg, the Himachal chief minister’s office on Monday said “we have been successful in resolving the issues” to end the 67-day dispute.

    WHATSAPP CHATS, PRAYERS AT TEMPLE

    Adani became India’s second largest cement manufacturer when it acquired ACC (ACC.NS) and Ambuja Cements (ABUJ.NS) in a $10.5 billion deal with Swiss giant Holcim (HOLN.S) last year.

    In December, it shut plants in the villages of Gagal and Darlaghat in Himachal, saying truckers were charging too much.

    The Adani group wanted freight rates to be lowered to around 6 rupees ($0.0725) per tonne per km, from around 11 rupees. Many truckers told Reuters they struggled to make their loan repayments as their incomes shrank after the shutdowns.

    As a stalemate worsened, truckers formed WhatsApp groups to coordinate efforts, vent frustration and later share Hindenburg’s impact on Adani companies and stock prices to further drum up support.

    One such WhatsApp group chat of around 1,000 truckers, reviewed by Reuters, showed sharing of a local reporter’s video discussing the sharp fall in Adani’s shares and his alleged close ties to Modi.

    Although they accepted a small cut in freight rates when Adani agreed to pay 9.3-10.58 rupees per km per tonne, truckers felt they saved their jobs, and prayers at the Hindu temple were organised again this week.

    “We felt our deity had accepted our prayers when we saw the fall in the share prices of Adani companies,” protest leader Shukla said. “The Hindenburg report was a gift that saved our businesses.”

    (This story has been refiled to remove extraneous word in paragraph 20)

    Reporting by Manoj Kumar, Aditya Kalra and Anushree Fadnavis; Editing by Lincoln Feast.

    Our Standards: The Thomson Reuters Trust Principles.

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  • Indian shares fall ahead of inflation data; Adani stocks slide

    Indian shares fall ahead of inflation data; Adani stocks slide

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    BENGALURU, Feb 13 (Reuters) – Indian shares were off to a muted start on Monday, ahead of domestic retail inflation data due later in the day and U.S. inflation data due tomorrow, while the ongoing uncertainty and spillover effects from the Adani Group’s market rout continued to create an overhang.

    The Nifty 50 index (.NSEI) was down 0.29% at 17,804.60 as of 9:37 a.m. IST, while the S&P BSE Sensex (.BSESN) fell 0.35% to 60,472.28.

    Ten of the 13 major sectoral indexes declined, with information technology stocks (.NIFTYIT) falling nearly 2% amid worries of a growth slowdown in the U.S., from where they get a significant share of their revenue.

    On the flip side, metals (.NIFTYMET) gained with a 1% rise.

    Twenty-seven of Nifty 50 constituents advanced with Titan Co (TITN.NS) and Eicher Motors Ltd (EICH.NS) among top gainers.

    Wall Street equities closed lower on Friday, on fears of a longer-than-expected high-rate regime after hawkish comments from key Federal Reserve officials.

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    Asian markets fell, with the MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) sliding 0.63%.

    Investors await India’s retail inflation data for January, due today. A Reuters poll of economists showed that India’s annual retail inflation rose from a 12-month low in December, but stayed within the 6% upper limit of RBI’s tolerance band in January.

    The uncertainty over the Adani conglomerate added to concerns in domestic markets.

    “The Adani group saga continues to weigh on investors’ minds and hence the sentiment has been negative,” said Prashanth Tapse of Mehta Equities.

    The group has lost over $100 billion in market value since Jan. 24, when U.S. short-seller Hindenburg Research accused the conglomerate of stock manipulation and improper use of tax havens.

    India’s market regulator is probing the group’s links to some of the investors in its scrapped $2.5 billion share sale of the flagship Adani Enterprises.

    ($1 = 82.5250 Indian rupees)

    Reporting by Bharath Rajeswaran in Bengaluru; Editing by Janane Venkatraman, Nivedita Bhattacharjee

    Our Standards: The Thomson Reuters Trust Principles.

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  • Adani slashes growth targets amid rout sparked by Hindenburg – Bloomberg News

    Adani slashes growth targets amid rout sparked by Hindenburg – Bloomberg News

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    Feb 13 (Reuters) – India’s Adani Group has halved its revenue growth target and plans to scale down fresh capital expenditure, Bloomberg News reported on Sunday.

    Listed companies controlled by billionaire Gautam Adani have lost more than $100 billion in market value since Jan. 24, when U.S. short-seller Hindenburg Research accused the conglomerate of stock manipulation and improper use of offshore tax havens.

    The group has rejected the allegations and denied any wrongdoing.

    The Adani Group will now shoot for revenue growth of 15% to 20% for at least the next financial year, down from the original target of 40%, Bloomberg News said citing people familiar with the matter.

    Holding back on investments for even as little as three months could save the conglomerate as much as $3 billion, the report said, adding that the plans are still imminent.

    A spokesperson for the Adani Group said the report was “baseless, speculative”, without elaborating further.

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    The group has also been a part of India’s market regulator’s investigation into its links to some of the investors in its scrapped $2.5 billion share sale.

    Earlier this month, India’s ministry of corporate affairs started a preliminary review of the group’s financial statements and other regulatory submissions made over the years, Reuters reported, citing two senior government officials.

    Reporting by Mrinmay Dey in Bengaluru; Editing by Kim Coghill and Savio D’Souza

    Our Standards: The Thomson Reuters Trust Principles.

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  • Adani’s market losses top $100 bln as crisis shockwaves spread

    Adani’s market losses top $100 bln as crisis shockwaves spread

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    • Market rout deepens in Indian tycoon Adani’s shares
    • Adani Enterprises loses $26 bln in value since report
    • Falls after Adani pulled share sale, investors spooked
    • Analysts say signals confidence crisis in Indian market

    NEW DELHI/MUMBAI, Feb 2 (Reuters) – Adani’s market losses swelled above $100 billion on Thursday, sparking worries about a potential systemic impact a day after the Indian group’s flagship firm abandoned its $2.5 billion stock offering.

    Another challenge for Adani on Thursday came when S&P Dow Jones Indices said it would remove Adani Enterprises from widely used sustainability indices, effective Feb. 7, which would make the shares less appealing to sustainability-minded funds.

    In addition, India’s National Stock Exchange said it has placed on additional surveillance shares of Adani Enterprises <ADEL.NS>, Adani Ports <APSE.NS> and Ambuja Cements <ABUJ.NS>. read more

    However, Adani Group Chairman Gautam Adani is in talks with lenders to prepay and release pledged shares as he seeks to restore confidence in the financial health of his conglomerate, Bloomberg News reported on Thursday. read more

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    The shock withdrawal of Adani Enterprises’ share sale marks a dramatic setback for founder Adani, the school dropout-turned-billionaire whose fortunes rose rapidly in recent years but have plunged in just a week after a critical research report by U.S.-based short-seller Hindenburg Research.

    Aborting the share sale sent shockwaves across markets, politics and business. Adani stocks plunged, opposition lawmakers called for a wider probe and India’s central bank sprang into action to check on the exposure of banks to the group. Meanwhile, Citigroup’s (C.N) wealth unit stopped making margin loans to clients against Adani Group securities.

    The crisis marks an dramatic turn of fortune for Adani, who has in recent years forged partnerships with foreign giants such as France’s TotalEnergies (TTEF.PA) and attracted investors such as Abu Dhabi’s International Holding Company as he pursues a global expansion stretching from ports to the power sector.

    In a shock move late on Wednesday, Adani called off the share sale as a stocks rout sparked by Hindenburg’s criticisms intensified, despite it being fully subscribed a day earlier.

    “Adani may have started a confidence crisis in Indian shares and that could have broader market implications,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.

    Adani Enterprises shares tumbled 27% on Thursday, closing at their lowest level since March 2022.

    Other group companies also lost further ground, with 10% losses at Adani Total Gas (ADAG.NS), Adani Green Energy (ADNA.NS) and Adani Transmission (ADAI.NS), while Adani Ports and Special Economic Zone shed nearly 7%.

    Since Hindenburg’s report on Jan. 24, group companies have lost nearly half their combined market value. Adani Enterprises – described as an incubator of Adani’s businesses – has lost $26 billion in market capitalisation.

    Adani is also no longer Asia’s richest person, having slid to 16th in the Forbes rankings of the world’s wealthiest people, with his net worth almost halved to $64.6 billion in a week.

    The 60-year-old had been third on the list, behind billionaires Elon Musk and Bernard Arnault.

    His rival Mukesh Ambani of Reliance Industries (RELI.NS) is now Asia’s richest person.

    [1/4] Indian billionaire Gautam Adani addresses delegates during the Bengal Global Business Summit in Kolkata, India April 20, 2022. REUTERS/Rupak De Chowdhuri

    Reuters Graphics

    BROADER CONCERNS

    Adani’s plummeting stock and bond prices have raised concerns about the likelihood of a wider impact on India’s financial system.

    India’s central bank has asked local banks for details of their exposure to the Adani Group, government and banking sources told Reuters on Thursday.

    CLSA estimates that Indian banks were exposed to about 40% of the $24.5 billion of Adani Group debt in the fiscal year to March 2022.

    Dollar bonds issued by entities of Adani Group extended losses on Thursday, with notes of Adani Green Energy crashing to a record low. Adani Group entities made scheduled coupon payments on outstanding U.S. dollar-denominated bonds on Thursday, Reuters reported citing sources.

    “We see the market is losing confidence on how to gauge where the bottom can be and although there will be short-covering rebounds, we expect more fundamental downside risks given more private banks (are) likely to cut or reduce margin,” said Monica Hsiao, chief investment officer of Hong Kong-based credit fund Triada Capital.

    In New Delhi, opposition lawmakers submitted notices in parliament demanding discussion of the short-seller’s report.

    The Congress Party called for a Joint Parliamentary Committee be set up or a Supreme Court monitored investigation, while some lawmakers shouted anti-Adani slogans inside parliament, which was adjourned for the day.

    ADANI VS HINDENBURG

    Adani made acquisitions worth $13.8 billion in 2022, Dealogic data showed, its highest ever and more than double the previous year.

    The cancelled fundraising was critical for Adani, which had said it would use $1.33 billion to fund green hydrogen projects, airports facilities and greenfield expressways, and $508 million to repay debt at some units.

    Hindenburg’s report alleged an improper use of offshore tax havens and stock manipulation by the Adani Group. It also raised concerns about high debt and the valuations of seven listed Adani companies.

    The Adani Group has denied the accusations, saying the allegation of stock manipulation had “no basis” and stemmed from an ignorance of Indian law. It said it has always made the necessary regulatory disclosures.

    Adani had managed to secure share sale subscriptions on Tuesday even though the stock’s market price was below the issue’s offer price. Maybank Securities and Abu Dhabi Investment Authority had bid for the anchor portion of the issue, investments which will now be reimbursed by Adani.

    Late on Wednesday, the group’s founder said he was withdrawing the sale given the share price fall, adding his board felt going ahead with it “will not be morally correct”.

    Reporting by Chris Thomas, Nallur Sethuraman, Tanvi Mehta, Ira Dugal, Aftab Ahmed, Sumeet Chatterjee, Anshuman Daga, Summer Zhen, Ross Kerber and Bansari Mayur Kamdar; Editing by Muralikumar Anantharaman, Jason Neely and Alexander Smith

    Our Standards: The Thomson Reuters Trust Principles.

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  • Adani crisis ignites Indian contagion fears, credit warnings

    Adani crisis ignites Indian contagion fears, credit warnings

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    • Both houses of parliament adjourned amid row
    • Flagship Adani firm plunges 35% at one point
    • Moody’s warns will find it harder to raise capital

    NEW DELHI, Feb 3 (Reuters) – Financial contagion fears spread in India on Friday as the Adani Group’s crisis worsened, with ratings agency Moody’s warning the conglomerate may struggle to raise capital and S&P cutting the outlook on two of its businesses.

    Chaotic scenes in both houses of India’s parliament led to their adjournment on Friday as some lawmakers demanded an inquiry after a dramatic meltdown in the stock market values of Indian billionaire Gautam Adani’s companies.

    The crisis was triggered by a Hindenburg Research report last week in which the U.S.-based short-seller accused the Adani Group of stock manipulation and unsustainable debt.

    Adani Group, one of India’s top conglomerates, has rejected the criticism and denied wrongdoing in detailed rebuttals, but that has failed to arrest the unabated fall in its shares.

    In the latest sign of the crisis widening, India’s ministry of corporate affairs has begun a preliminary review of Adani Group’s financial statements and other regulatory submissions made over the years, two government officials told Reuters.

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    Although shares in Adani companies recovered after sharp falls earlier on Friday, the seven listed firms have still lost about half their market value, totalling more than $100 billion since Hindenburg published its report on Jan. 24.

    Moody’s warned the share plunge could hit the Adani Group’s ability to raise capital, although fellow credit ratings agency Fitch saw no immediate impact on its ratings.

    “These adverse developments are likely to reduce the group’s ability to raise capital to fund committed capex or refinance maturing debt over the next 1-2 years. We recognise that a portion of the capex is deferrable,” Moody’s said.

    For Adani, a former school drop-out from Gujarat, the western home state of Indian Prime Minister Narendra Modi, the crisis presents the biggest reputational and business challenge of his life, as his firm struggles to assuage investor concerns.

    Amid fears the turmoil could spill over into the broader financial system, some Indian politicians have called for a wider investigation, and sources have told Reuters the central bank has asked lenders for details of exposure to the group.

    “Contagion concerns are widening, but still limited to the banking sector,” Charu Chanana, a market strategist with Saxo Markets in Singapore, said on Friday.

    The Reserve Bank of India said the country’s banking system remains resilient and stable. State Bank of India said it was not concerned about the exposure to Adani Group, but further financing to its projects would be “evaluated on its own merit”.

    Adani Enterprises shares closed 1.4% higher, after earlier slumping 35% to hit their lowest since March 2021. That low took its losses to nearly $33.6 billion since last week, a 70% fall.

    Shares fell 5% in Adani Total Gas (ADAG.NS), a joint venture with France’s TotalEnergies (TTEF.PA), which said its exposure to Adani companies was limited.

    Traffic moves past the logo of the Adani Group installed at a roundabout on the ring road in Ahmedabad, India, Feb. 2, 2023. REUTERS/Amit Dave

    Adani Ports and Special Economic Zone (APSE.NS) was up 8%, while Adani Transmission (ADAI.NS) and Adani Green Energy (ADNA.NS) were both down 10%.

    “There is a risk that investor concerns about the group’s governance and disclosures are larger than we have currently factored into our ratings,” S&P said, as it cut its outlook on Adani Ports and Adani Electricity to negative from stable.

    India’s divestment secretary Tuhin Kanta Pandey told Reuters that Life Insurance Corp (LIC) shareholders and customers should not be concerned about its exposure to the Adani Group.

    State-run LIC (LIFI.NS) has a 4.23% stake in the flagship Adani Enterprises, while its other exposures include a 9.14% stake in Adani Ports.

    Reuters Graphics

    ‘ONE INSTANCE’

    Adani, 60, has in recent years forged partnerships with, and attracted investment from, foreign giants as he pursued global expansion in industries from ports to power.

    The market and financial crisis means foreign investors, many already underweight on India as they consider its stock market overpriced, are reducing exposure.

    “One instance, however much talked about globally it may be … is not going to be indicative of how well Indian financial markets are governed,” Indian Finance Minister Nirmala Sitharaman told Network18 when asked about the market weakness.

    Reuters Graphics

    Hindenburg’s report said key listed Adani companies had “substantial debt” and shares in the seven listed firms had a downside of 85% due to what it called sky-high valuations.

    The Adani Group has called the report baseless and said over the past decade, its companies have “consistently de-levered”.

    The listed Adani firms now have a combined market value of $107.5 billion, versus $218 billion before the report.

    That has forced Adani to cede the crown of Asia’s richest person to Indian rival Mukesh Ambani of Reliance Industries Ltd (RELI.NS), and he has slid to 17th in Forbes’ list of the world’s wealthiest people.

    He had ranked third, behind Elon Musk and Bernard Arnault.

    Reporting by Aditya Kalra, Chris Thomas, Ankur Banerjee, Bansari Mayur Kamdar, Shivam Patel, Tanvi Mehta and Rae Wee in Singapore; Editing by Clarence Fernandez, Mark Potter and Alexander Smith

    Our Standards: The Thomson Reuters Trust Principles.

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  • U.S. FDA allows abortion pills to be sold at retail pharmacies

    U.S. FDA allows abortion pills to be sold at retail pharmacies

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    WASHINGTON, Jan 3 (Reuters) – The U.S. Food and Drug Administration (FDA) will allow retail pharmacies to offer abortion pills in the United States for the first time, the agency said on Tuesday, even as more states seek to ban medication abortion.

    The regulatory change will potentially expand abortion access as President Joe Biden’s administration wrestles with how best to protect abortion rights after they were sharply curtailed by the Supreme Court’s decision to overturn the landmark Roe v Wade ruling and the state bans that followed.

    Pharmacies can start applying for certification to distribute abortion pill mifepristone with one of the two companies that make it, and if successful they will be able to dispense it directly to patients upon receiving a prescription from a certified prescriber.

    The FDA had first said it would be making those changes in December 2021 when it announced it would relax some risk evaluation and mitigation strategies, or REMS, on the pill, that had been in place since the agency approved it in 2000 and were lifted temporarily in 2021 due to the COVID-19 pandemic.

    The changes included permanently removing restrictions on mail order shipping of the pills and their prescription through telehealth.

    The agency finalized the changes on Tuesday after reviewing supplemental applications from Danco Laboratories and GenBioPro, the two companies that make the drug in the United States.

    “Under the Mifepristone REMS Program, as modified, Mifeprex and its approved generic can be dispensed by certified pharmacies or by or under the supervision of a certified prescriber,” the agency said on its website on Tuesday.

    Mifeprex is the brand name version of mifepristone which, in combination with a second drug called misoprostol that has various uses including miscarriage management, induces an abortion up to 10 weeks into a pregnancy in a process known as medication abortion.

    Abortion rights activists say the pill has a long track record of being safe and effective, with no risk of overdose or addiction. In several countries, including India and Mexico, women can buy them without a prescription to induce abortion.

    “Today’s news is a step in the right direction for health equity,” Planned Parenthood President Alexis McGill Johnson said in a statement.

    “Being able to access your prescribed medication abortion through the mail or to pick it up in person from a pharmacy like any other prescription is a game changer for people trying to access basic health care,” Johnson added.

    NO EQUAL ACCESS

    The regulatory change will, however, not provide equal access to all people, GenBioPro, which makes the generic version of mifepristone, said in a statement.

    Abortion bans, some targeting mifepristone, have gone into effect in more than a dozen states since the U.S. Supreme Court overturned the constitutional right to terminating pregnancies when it scrapped the 1973 Roe v. Wade ruling last year.

    Women in those states could potentially travel to other states to obtain medication abortion.

    The president of anti-abortion group SBA Pro-Life America, Marjorie Dannenfelser, said the latest FDA move endangers women’s safety and the lives of unborn children.

    “State lawmakers and Congress must stand as a bulwark against the Biden administration’s pro-abortion extremism,” she said in a statement.

    FDA records show a small mortality case number associated with mifepristone. As of June 2021, there were reports of 26 deaths linked with the pill out of 4.9 million people estimated to have taken it since it was approved in September 2000.

    Retail pharmacies will have to weigh whether or not to offer the pill given the political controversy surrounding abortion, and determine where they can do so.

    A spokesperson for CVS Health (CVS.N) said the drugstore chain owner was reviewing the updated REMS “drug safety program certification requirements for mifepristone to determine the requirements to dispense in states that do not restrict the dispensing of medications prescribed for elective termination of pregnancy.”

    A spokesperson for Walgreens (WBA.O), one of the largest U.S. pharmacies, said the company was also reviewing the FDA’s regulatory change. “We will continue to enable our pharmacists to dispense medications consistent with federal and state law.”

    Reporting by Ahmed Aboulenein; Additional reporting by Eric Beech in Washington, Shivani Tanna, Rahat Sandhu, and Kanjyik Ghosh in Bengaluru; Editing by Himani Sarkar

    Our Standards: The Thomson Reuters Trust Principles.

    Ahmed Aboulenein

    Thomson Reuters

    Washington-based correspondent covering U.S. healthcare and pharmaceutical policy with a focus on the Department of Health and Human Services and the agencies it oversees such as the Food and Drug Administration, previously based in Iraq and Egypt.

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  • Twitter lays off staff, Musk blames activists for ad revenue drop

    Twitter lays off staff, Musk blames activists for ad revenue drop

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    • Musk axes around half of Twitter’s workforce
    • Employees file class action against Twitter
    • Staff lose access to systems
    • Major advertisers pull ads

    Nov 4 (Reuters) – Twitter Inc laid off half its workforce on Friday but said cuts were smaller in the team responsible for preventing the spread of misinformation, as advertisers pulled spending amid concerns about content moderation.

    Tweets by staff of the social media company said teams responsible for communications, content curation, human rights and machine learning ethics were among those gutted, as were some product and engineering teams.

    The move caps a week of chaos and uncertainty about the company’s future under new owner Elon Musk, the world’s richest person, who tweeted on Friday that the service was experiencing a “massive drop in revenue” from the advertiser retreat.

    Musk blamed the losses on a coalition of civil rights groups that has been pressing Twitter’s top advertisers to take action if he did not protect content moderation – concerns heightened ahead of potential pivotal congressional elections on Tuesday.

    After the layoffs, the groups said they were escalating their pressure and demanding brands pull their Twitter ads globally.

    “Unfortunately there is no choice when the company is losing over $4M/day,” Musk tweeted of the layoffs, adding that everyone affected was offered three months of severance pay.

    The company was silent about the depth of the cuts until late in the day, when head of safety and integrity Yoel Roth tweeted confirmation of internal plans, seen by Reuters earlier in the week, projecting the layoffs would affect about 3,700 people, or 50% of the staff.

    Among those let go were 784 employees from the company’s San Francisco headquarters and 199 in San Jose and Los Angeles, according to filings to California’s employment authority.

    Roth said the reductions hit about 15% of his team, which is responsible for preventing the spread of misinformation and other harmful content, and that the company’s “core moderation capabilities” remained in place.

    Musk endorsed the safety executive last week, citing his “high integrity” after Roth was called out over tweets critical of former President Donald Trump years earlier.

    Musk has promised to restore free speech while preventing Twitter from descending into a “hellscape.”

    President Joe Biden said on Friday that Musk had purchased a social media platform in Twitter that spews lies across the world.

    “And now what are we all worried about: Elon Musk goes out and buys an outfit that sends – that spews lies all across the world… There’s no editors anymore in America. There’s no editors. How do we expect kids to be able to understand what is at stake?”

    Major advertisers have expressed apprehension about Musk’s takeover for months.

    Brands including General Motors Co (GM.N) and General Mills Inc (GIS.N) have said they stopped advertising on Twitter while awaiting information about the new direction of the platform.

    Musk tweeted that his team had made no changes to content moderation and done “everything we could” to appease the groups. Speaking at an investors conference in New York on Friday, Musk called the activist pressure “an attack on the First Amendment.”

    [1/9] Owner and CEO of Twitter, Inc. Elon Musk arrives at the 29th Annual Baron Investment Conference in Manhattan in New York City, New York, U.S., November 4, 2022. REUTERS/Andrew Kelly

    Twitter did not respond to a request for comment.

    ACCESS TO SYSTEMS CUT

    The email notifying staff about layoffs was the first communication Twitter workers received from the company’s leadership after Musk took over last week. It was signed only by “Twitter,” without naming Musk or any other executives.

    Dozens of staffers tweeted they had lost access to work email and Slack channels overnight before receiving an official layoff notice on Friday morning, prompting an outpouring of laments by current and former employees on the platform they had built.

    They shared blue hearts and salute emojis expressing support for one another, using the hashtags #OneTeam and #LoveWhereYouWorked, a past-tense version of a slogan employees had used for years to celebrate the company’s work culture.

    Twitter’s curation team, which was responsible for “highlighting and contextualizing the best events and stories that unfold on Twitter,” had been axed, employees wrote.

    Shannon Raj Singh, an attorney who was Twitter’s acting head of human rights, tweeted that the entire human rights team at the company had been sacked.

    Another team that focused on research into how Twitter employed machine learning and algorithms, an issue that was a priority for Musk, was also eliminated, according to a tweet from a former senior manager at Twitter.

    Senior executives including vice president of engineering Arnaud Weber said their goodbyes on Twitter on Friday: “Twitter still has a lot of unlocked potential but I’m proud of what we accomplished.”

    Employees of Twitter Blue, the premium subscription service that Musk is bolstering, were also let go. An employee with the handle “SillyRobin” who had indicated they were laid off, quote-tweeted a previous Musk tweet saying Twitter Blue would include “paywall bypass” for certain publishers.

    “Just to be clear, he fired the team working on this,” the employee said.

    DOORS LOCKED

    Twitter said in its email to staffers that offices would be temporarily closed and badge access suspended “to help ensure the safety of each employee as well as Twitter systems and customer data.”

    Offices in London and Dublin appeared deserted on Friday, with no employees in sight. At the London office, any evidence Twitter had once occupied the building was erased.

    A receptionist at Twitter’s San Francisco headquarters said a few people had trickled in and were working in the floors above despite the notice to stay away.

    A class action was filed on Thursday against Twitter by several employees, who argued the company was conducting mass layoffs without providing the required 60-day advance notice, in violation of federal and California law.

    The lawsuit asked the San Francisco federal court to issue an order to restrict Twitter from soliciting employees being laid off to sign documents without informing them of the pendency of the case.

    Reporting by Sheila Dang in Dallas, Katie Paul in Palo Alto, California, and Paresh Dave in Oakland, California; Additional reporting by Fanny Potkin, Rusharti Mukherjee, Aditya Kalra, Martin Coulter, Hyunjoo Jin, Supantha Mukherjee and Arriana McLymore; Writing by Matt Scuffham and Katie Paul; Editing by Kenneth Li, Jason Neely, Matthew Lewis and William Mallard

    Our Standards: The Thomson Reuters Trust Principles.

    Paresh Dave

    Thomson Reuters

    San Francisco Bay Area-based tech reporter covering Google and the rest of Alphabet Inc. Joined Reuters in 2017 after four years at the Los Angeles Times focused on the local tech industry.

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