This week in the news: Chandrayaan 2 mission control loses contact with the lander 13 minutes into descent. India’s tourism sector shines bright in a gloomy economic landscape. Last month, India’s manufacturing PMI grew at its slowest pace in 15 months. India’s services PMI declines, pushing composite index further down. GST Council may consider tax cut for hybrid vehicles amidst auto sector slowdown. Automakers in India demand tax cuts amidst massive slowdown. WeWork may half valuation ahead of its IPO. Alibaba announces entry into Indian e-commerce market through its UCWeb browser app. Vote along Party lines or face expulsion, Boris Johnson warns Conservative MPs. The Brexit question goes back to the British people – another general election is in the offing.
Moving on to the top Business news of the week:
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Setback, But We'll Be Back: 13 minutes after the Vikram lander began its descent onto lunar surface, the Chandrayaan 2 mission control lost contact with the probe. Unable to bring its speed down to the required level, Vikram failed to make a soft-landing on the Moon. Now, the lander and rover are most likely lost.
A sombre ISRO said it would analyse the data and that though contact with the lander had been lost, the orbiter was still up and running. "Only 5% of the mission has been lost - Vikram the lander and Pragyan the rover - while the remaining 95% - that is the Chandrayaan 2 orbiter - is orbiting the moon successfully," an ISRO official told IANS.
ISRO, Take A Bow: Condolences and messages of support flowed in from across the country from people from all walks of life. The Prime Minister said, “When ISRO has its encyclopedia of success, some hurdles cannot put its flight out of trajectory. Learnings from today will make us stronger and better; there will be a new dawn.”
Wanderlust Wonders: Meanwhile, while most sectors of the economy confront a slowdown and unemployment is at a historic high, one sector shines bright. India’s tourism sector is doing better than before, climbing six slots in the WEF’s Travel and Tourism Competitiveness Index to be ranked 34, the greatest improvement since 2017.
Down and Downer: India’s manufacturing PMI didn’t manufacture much expansion in August. The pace of demand and output growth was the slowest in 15 months, the Nikkei Manufacturing Purchasing Managers’ Index showed.
By declining to 51.4 from July’s 52.5, the Index registered its lowest growth since May 2018.The silver lining is that it remains above the 50-mark line that separates growth and contraction.
Going Down: India’s Services PMI declined to 52.4 In August after July’s year-high of 53.8. Though this is still higher than the 50-mark separating growth from contraction, the fall in services PMI alongwith manufacturing PMI (which is at a 15-month low) has pushed the composite index down to 52.6 from the previous 53.9. (A historical overview of the services PMI can be found Here.)
This comes on the heels of the recently released GDP numbers, which showed the Indian economy growing at 5%, the lowest rate in six years.
Clutching at the Straw: Amidst a severe drop in sales in the auto sector, the GST Council is examining a Rate cut for hybrid vehicles By doing away with the cess, which will bring down the tax rate from 43% to 28%.
Currently, all four- and two-wheelers for commercial or personal use - except electric vehicles, bicycles, rickshaws, etc — are now in the 28% GST bracket.
A Sorry Tale to Tell: Passenger vehicles sales in India are set to fall for a tenth consecutive month in August, forcing analysts to slash their 2019 sales forecasts.
Data from top six car makers, including Suzuki and Toyota, which make up more than 90% share of the market shows that passenger vehicle sales for August fell 34% vs previous year.
Data from Tata Motors and Mahindra & Mahindra, which together account for about two-thirds of the commercial vehicles market, show that sales of trucks, an indicator of economic activity, fell by almost 40%.
As per Rajan Wadhera, President of the Society of Indian Automobile Manufacturers (SIAM), the plunge in sales only highlight the need for the government to consider reducing the GST.
All Work and No Joy: Shared working spaces company, WeWork’s parent company WeCompany is reportedly considering cutting the value of its upcoming share offering in half amidst growing skepticism over its business model and corporate governance.
The We Company is in talks to value itself at c. $20bn-$30bn. This is well below the $47bn valuation at which the company raised money in January.
Here’s a closer look at what is transpiring at the company which changed the way we all work.
Shopping With Alibaba: Alibaba Group is set to enter the Indian e-commerce market through the UCWeb browser app. While details haven’t been revealed yet, the e-commerce business venture could include movie ticket bookings – this would indicate competition with BookMyShow and Paytm, the latter of which is partly owned by Alibaba. But the Chinese firm believes its entry into the Indian market won’t have an adverse effect on Paytm, saying it seeks partnerships and not competition.
Oh Brexit: The Brexit monster continues to eat into British politics. Following his controversial decision to prorogue Parliament for 23 days so as to give Parliamentarians less time to stop a no-deal Brexit or debate on any deal that could be finalised in coming weeks, PM Boris Johnson has warned Conservative MPs against backing legislation that could put a no-deal exit off the table. Doing so, the PM said, would mean expulsion from the Party.
The Opposition is mulling over legislation that seeks an extension from the EU beyond the October 31 deadline. This is likely to be voted on tomorrow (Tuesday), after which MPs will be off for over three weeks. At the same time, senior Cabinet ministers have hinted that even if such a law was to be passed, the government would ignore it i.E. Britain would break its ties with Brussels on October 31 come what may.
A Second Referendum Through Other Means: The UK is now likely heading towards a general election in the coming weeks. Which is for the best because now the Brexit question will again be put back to the people. Since the 2016 referendum British politics has been paralysed and infinitely polarised, especially so after the 2017 snap election, which sent to Parliament a diverse array of MPs with a kaleidoscope of Brexit views. A new election will put the question back to the electorate and instruct MPs on the pulse of public opinion.
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