General Awareness

BUSINESS AND ECONOMY - December 2015

Dec 2015

Nov 16, 2019

Bank Deposit Insurance Cover to be Hiked, Regulation on Co-operative Banks Soon

According to Finance Minister Nirmala Sitharaman, the government will bring legislations on raising insurance cover on bank deposits from the current Rs. 1 lakh and regulating multi-state co-operative banks amidst a crisis in PMC Bank affecting lakhs of depositors.
These legislations will be brought during the Winter Session of Parliament.
The legislation will amend the necessary Acts and the laws to make sure that banking functions undertaken by co-operatives sector will be brought under the Banking Regulation Act for complying with prudential norms.
Unless the prudential norms are applied, many of the things that are emerging in the light of the Punjab and Maharashtra Co-operative (PMC) Bank crisis will never be addressed and this legislation will ensure that no PMC like case happens in the future, she added.
With regard to deposit guarantee insurance limit hike, Sitharaman said it may not be part of cooperative bank legislation but part of some other laws.

No GST on Salaries Paid to CEOs or Employees

The Central Board of Indirect Taxes and Customs (CBIC) clarified that salaries are not subject to Goods and Services Tax (GST). It further added that no GST has been demanded on salaries paid to chief executive officers or employees.
According to the CBIC statement, reports that tax authorities want to impose GST on salaries paid to employees is factually incorrect and misrepresents tax authorities.
The CBIC statement further said that GST law position clearly states under Section 7(2) read with schedule three of the Central GST Act 2017 that salaried services by an employee to an employer will be treated neither as a supply of goods nor as a supply of services.

ArcelorMittal to Acquire Bankrupt Essar Steel

The stage is set for the princely entry of Aditya Mittal in Indian business. The London-based Mittal family-controlled ArcelorMittal-- the world's largest steel manufacturing company-- won the legal battle to acquire bankrupt Essar Steel after two-year-long insolvency proceedings.
The Supreme Court approved the Rs. 42,000 crore takeover plan of ArcelorMittal.
Essar Steel, which has 10 million tonnes (MT) steel manufacturing complex in Hazira, Gujarat, is expected to be handed over to ArcelorMittal management in a month's time as when payments to lenders are made.
The new management may be headed by Aditya Mittal, who is the President and Chief Financial Officer of ArcelorMittal. He is also the CEO of ArcelorMittal Europe.
Aditya Mittal has been leading the negotiations to acquire Essar Steel since 2017.

India is Most Open Economy

Prime Minister Narendra Modi pitched India as the "most open and investment-friendly economy" even as he called on members of BRICS to make the grouping's mechanisms more efficient and outcome-driven to boost economic growth.
Modi concluded his visit to Brasilia, where he attended the BRICS Summit.

HDFC Bank Crosses Rs.7 Lakh Crore in Mcap

HDFC Bank Ltd crossed Rs. 7 lakh crore in market capitalization for the first time to become India's third firm, and the first lender, to achieve the milestone. Tata Consultancy Services (TCS) Ltd and Reliance Industries Ltd were the only other companies to have achieved the landmark.
At present, RIL is the most-valued company with a market capitalization of Rs. 9.31 lakh crore, followed by TCS at Rs. 8.16 lakh crore.

Top Court Extends 330-day Limit for Insolvency Resolution

In a judgment significant for India's fledgling corporate resolution process under the Insolvency and Bankruptcy Code, the Supreme Court increased the time limit for corporate resolution to extend beyond the mandated 330 days.
As of now, the time limit for resolution process is mandatorily 330 days in all cases. If debts are not resolved and the bankrupt firm cannot be brought back to its feet within this time-frame, the only option left is liquidation of its assets to pay creditors.
A Bench led by Justice Nariman, in the ArcelorMittal judgment, observed that many litigants suffer the prospect of liquidation for no fault of theirs.
Delay in legal proceedings leads to the resolution process being dragged beyond the 330-day mark.
The court said that the 330-day time limit was no longer mandatory.
The court held the mandatory nature of the 330-day mark as a violation of Article 14 (right to equal treatment) of the Constitution and an excessive and unreasonable restriction on the litigant's right to carry on business under Article 19(1)(g) of the Constitution.

HC Allows Banks to Recover Loan Amount from DHFL

The Bombay High Court granted relief to a clutch of banks by allowing Dewan Housing Finance Limited (DHFL) to pay back loans extended by the lenders to the debt-laden home financier.
The order was passed by the court after the banks sought relaxation of an October order in a suit wherein DHFL was restrained from making payments to any creditors.
The court granted the relief provided DHFL maintained a security cover equal to 1.1 times the amount of the outstanding non-convertible debentures it owed to Reliance Nippon Life Asset Management, which filed the suit.

Nov 15, 2019

Amazon Begins Appeal Over Pentagon Cloud Contract

Amazon has filed an intention to appeal the US Department of Defense's decision to give a major contract to Microsoft.
Amazon had been considered the favorite to win the deal, worth $10bn over the next 10 years.
The company, which already provides cloud computing to the US Central Intelligence Agency, said the decision was made due to political pressure.
In July, President Donald Trump threatened to intervene after what he described as "tremendous complaints".
Mr Trump had previously attacked Amazon chief executive Jeff Bezos, who also owns the Washington Post.
The Pentagon subsequently delayed its decision to award the contract until 25 October, when it was announced the work would be given to Microsoft.

Govt Eases Norms For Opening Bank Account For Migrants

The government has eased KYC norms for migrants to open bank account by allowing them to give a self-declared local address as sufficient proof of residence in case it is different from one mentioned in Aadhaar document.
Migrants face difficulties in having proof of residence as address on Aadhaar is different from their current location.
The Department of Revenue notification is with regard to easing of Aadhaar KYC use for opening of the bank account for the convenience of people who often migrate from place to place for jobs or any other reason.
The changes were made by amending the Prevention of Money-laundering (Maintenance of Records) Rules.

HMSI Launches BS VI-Compliant SP 125 Bike

Honda Motorcycle and Scooter India (HMSI) launched a new BS VI-compliant bike SP 125 with price starting at Rs 72,900 (ex-showroom Delhi).
The new bike replaces the company's 125cc model CB Shine SP. The Japanese two-wheeler major would, however, continue to sell BS IV CB Shine in the market.
The new model is around 11 per cent costlier than the outgoing model and, as per the company, delivers 16 per cent better fuel efficiency.
HMSI Senior Vice President, Sales and Marketing, Yadvinder Singh Guleria said the company has a market share of 39 per cent in the 125 cc bike category.

Nov 14, 2019

BHIM UPI Goes International

A pilot demonstration of the Bharat Interface for Money (BHIM) united payments interface (UPI) QR-based payments has begun at the Singapore fintech festival 2019.
Conducted through a live transaction at a merchant terminal on November 13, 2019, this is the payment system's first approach to the international market.
The demo will continue for the duration of the festival, which started on November 11, 2019 and ends on November 15, 2019.
This QR code-based system would allow anyone with a BHIM app to scan the SGQR at NETS terminals for payments in Singapore.

Nov 13, 2019

Urban Cooperative Banks' Business Size May Be Capped At Rs 20,000 Cr

The new regulatory framework for urban co-operative banks (UCBs) is expected to stipulate a threshold business size of Rs 20,000 crore, beyond which it will not be life as usual for these entities.
Curbs are also expected to be placed on UCBs on some of their specific activities (especially on sensitive sectors like realty), so as to restrain their growth, given the less-than-adequate oversight of them.

Karnataka Gramin Bank Initiates 'Mobile ATMs' To Push Digitisation In Rural Areas

In a move to boost digitisation in rural areas, the Karnataka Gramin Bank (KGB) has launched 'mobile ATMs' in Kalaburagi among several other districts in the state.
The special vehicle includes an ATM and a screen to show videos of different banking schemes.
The project was assisted by a Financial Inclusion Fund by the National Bank of Agriculture and Rural Development.
The mobile ATMs will go to the doorsteps of the farmers and make them aware of the banking schemes and digital operating systems.

HSBC and RBS Set To Launch New Digital Banking Platforms

British banking heavyweights HSBC (HSBA.L) and RBS (RBS.L) are launching new digital banking platforms, as competition for digitally savvy customers steps up in the face of a wave of online startups.
HSBC rolled out a new app-based business banking service - previously known internally as 'Project Iceberg' and now named 'HSBC Kinetic' - in beta testing mode.
While RBS is putting the finishing touches to its new digital bank Bo ahead of a public roll-out later this month.RBS's standalone bank Bo is preparing for a public launch this month from offices in London's West End.The Bo app is designed to encourage customers to budget and save better, alerting them if they overspend.
It is targeted at the 16.8 million Britons with less than 100 pounds ($128)of savings.
RBS hopes it will bring in lower cost deposits than the bank's main retail brands as it is built on a leaner banking platform, with an estimated cost per consumer of 80 pounds a year, rather than 150-200 pounds at RBS.

Vodafone's India Ops on Brink of Collapse

Vodafone Idea, India's second-largest telecom company, may be headed for liquidation unless the government eases off on demands for mobile spectrum fees, Nick Read.
The company's future in India could be in doubt unless the government stopped hitting operators with higher taxes and charges, after the Supreme Court asked operators to pay over Rs 92,000 crore in past dues.
Read said India, where Vodafone formed a joint venture with Aditya Birla group's Idea Cellular in 2018, had been "a very challenging situation for a long time", but Vodafone Idea still had 30 crore customers or about 30% marketshare.

Amazon Launches 'Project Zero' In India To Block Counterfeit Goods

In a bid to ensure that customers receive authentic goods when shopping on Amazon. Amazon on announced to bring "Project Zero" to India. "Project Zero" introduces additional proactive mechanisms and powerful tools to identify, block and remove counterfeits.
Over 7,000 brands have already enrolled in Project Zero across US, Europe and Japan. A number of Indian brands participated in a pilot to help the company test the experience in India.

Nov 12, 2019

NCLT Orders Insolvency Proceedings Against Aviva Life Insurance

The National Company Law Tribunal has ordered to initiate insolvency proceedings against Aviva Life Insurance in a case filed by Apeejay Trust.
A two-member bench of NCLT Delhi comprising Justice R D Khare and Sumita Purkayastha allowed the plea against Aviva Life Insurance and has also appointed an interim resolution professional to run day-to-day affairs of the company.
Apeejay Trust, which had leased its Mumbai-based (Vashi) premise to Aviva Life Insurance, claimed a default of ₹27.67 lakh as an operational creditor for not receiving payments towards service tax and license fee for the premise.

RBI Withdraws Certain Exemptions From Housing Finance Companies

The Reserve Bank of India (RBI) has withdrawn certain exemptions granted to housing finance companies (HFCs), putting its regulations on par with those of non-banking financial companies (NBFCs).
This comes after the Finance Act, 2019 amended the National Housing Bank Act, 1987, conferring certain powers for regulation of HFCs with the Reserve Bank of India.
The central bank said HFCs are currently exempt from the provisions of Chapter IIIB of Reserve Bank of India Act, 1934.
However, on a review, it has been decided to withdraw these exemptions and make the provisions of Chapter IIIB except Section 45-IA of Reserve Bank of India Act applicable to them.

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