General Awareness

BUSINESS AND ECONOMY - February 2017

Feb 2017

Oct 05, 2020

Tata Sons in Talks to Buy AirAsia's 49% in Joint Venture

Tata Sons is reviewing its budget airline joint venture with Malaysia's AirAsia as the latter faces financial challenges exacerbated by the pandemic. The evaluation follows the Malaysian company's reluctance to inject fresh equity into AirAsia India.
The holding company of the Tata Group, which owns 51% in the six-year-old low-cost carrier, is in discussions to buy out the remaining 49% held by AirAsia, said a source in the know. Tata Sons has the first right of refusal for the minority stake owned by AirAsia in the India venture.
AirAsia, which announced its biggest quarterly loss in August, plans to raise $600 million through debt and equity to weather the pandemic even as it evaluates some of its operations outside Malaysia. In recent months, AirAsia's founder and CEO Tony Fernandes said that India is a peripheral market, which it could exit one day. In July, AirAsia's auditor EY had flagged going concern doubts on the company's operations after its current liabilities exceeded assets.
AirAsia, because of its financial difficulties, is not keen on infusing capital into the India JV. It wants the JV to take on debt to run the operations. Tata Sons is forced to consider buying out AirAsia.

SAIL Exploring New Markets to Source Coking Coal

State-run steel maker SAIL is exploring new markets for the sourcing of coking coal with a view to reducing dependence on select countries for the raw material.
According to official data, the country imports about 56 million tonne (MT) of coking coal worth around Rs 72,000 crore. Out of this, about 45 MT is imported from Australia alone, and the remaining from South Africa, Canada and the US.
Domestic steelmakers depend heavily on imported coking coal. For SAIL as well as metallurgical coal (coking coal) is largely procured through imports apart from some domestic sourcing. We are looking at developing new destinations and vendors for sourcing coking coal from the international market to avoid dependence on limited sources.
Raw material security holds significance for the steelmaker which plans to more than double its capacity to 50 MTPA by 2030.

Market Cap of 8 of 10 most Valued Firms Zooms

Eight of the 10 most valued companies added Rs. 1,45,194.57 crore in their total market valuation last week with Tata Consultancy Services and HDFC Bank emerging as leading gainers.
The market valuation of Tata Consultancy Services (TCS) zoomed Rs. 37,692.7 crore to Rs. 9,46,632.85 crore, emerging as the biggest gainer among the top 10 firms.
HDFC Bank's valuation jumped Rs. 34,425.67 crore to Rs. 6,09,039.90 crore. The market capitalisation of HDFC gained Rs. 25,091.57 crore to Rs. 3,21,430.66 crore.
Reliance Industries Limited (RIL) added Rs. 15,789.36 crore to Rs. 15,04,587.18 crore and the valuation of ICICI Bank rose by Rs. 14,244.15 crore to reach Rs. 2,54,574.08 crore.
The valuation of Kotak Mahindra Bank went up by Rs. 11,053.88 crore to Rs. 2,58,346 crore and that of Hindustan Unilever Limited (HUL) by Rs. 4,064.73 crore to reach Rs. 4,92,243.78 crore. Infosys added Rs. 2,832.51 crore to Rs. 4,33,480.32 crore.
In contrast, Bharti Airtel's valuation diminished by Rs. 4,009.84 crore to Rs. 2,35,871.02 crore and that of HCL Technologies Limited declined by Rs. 4,002.66 crore to Rs. 2,20,553.13 crore.
In the ranking of top-10 firms, RIL remained at the number one rank followed by TCS, HDFC Bank, HUL, Infosys, HDFC, Kotak Mahindra Bank, ICICI Bank, Bharti Airtel and HCL Technologies.

China Accuses India of Discriminatory Trade Measures at the WTO

Beijing has accused New Delhi of discriminatory and restrictive trade measures, pointing to the ban on Chinese apps and curbs on foreign direct investment from the neighbouring country.
During a recent meeting at the World Trade Organisation (WTO), China alleged that the measures undermine the transparency, stability and predictability of the Indian market.
China said India banned the use of 234 mobile apps, most of which were developed and operated by Chinese internet companies.
China expressed its concerns about the recent restrictions by the US and India on its mobile applications as 'TikTok and WeChat'.
India, however, hit back saying China had one of the most restrictive digital economy frameworks in the world and should reflect on its own transparency record first and its long-standing reluctance to fully open up to foreign trading services.

Oct 04, 2020

Fair and Transparent Process Followed in MSIP Bid: UIDAI on Charges by Tech Companies

The Aadhaar-issuing body UIDAI has said that its tender for selecting managed services infrastructure provider (MSIP) has been evaluated, ensuring complete "transparency, fairness and equity" in accordance with stipulated norms.
Tech majors IBM, Wipro and Dell had allegedly flagged certain concerns around the evaluation process.
(UIDAI) had floated a tender for contracting a managed services infrastructure provider.
Following a technical evaluation of the bids, Hewlett Packard Enterprise (HPE) was given a score of 98 on 100, higher than those awarded to IBM, TCS and Wipro, a source said. According to another source, a Letter of Intent has been issued to HPE for the project.
As per reports, Wipro, IBM and Dell had reached out to the UIDAI a few months back allegedly raising concerns around the evaluation process.
The UIDAI strongly refuted the charges, asserting that the evaluation in the said 'MSIP' Request for Proposal has been done ensuring transparency, fairness and equity in accordance to the CVC guidelines and other applicable rules.

Regional Rural Banks Incur Net Loss of Rs. 2,206 crore in FY20

According to data published by NABARD, Regional rural banks (RRBs) as a group reported a net loss of Rs. 2,206 crore in the fiscal year ended March 31, 2020, as against Rs. 652-crore net loss in FY19.
During FY 2019-20, 26 RRBs earned a profit of Rs. 2,203 crore, while 19 incurred losses of Rs. 4,409 crore, the data showed.
The data on RRBs, recently published by the National Bank for Agriculture and Rural Development (Nabard), is based on the data uploaded by the RRBs in the Ensure portal.
As on March 31, 2020, there were 45 RRBs functioning in 685 districts of 26 states and three union territories (UTs). These RRBs were sponsored by 15 commercial banks and operating through a network of 21,850 branches.
Gross non-performing assets as a percentage of gross loans outstanding of RRBs marginally declined to 10.4 per cent as on March 31, 2020, from 10.8 per cent as on March 31, 2019, the data showed.
Share of standard, sub-standard, doubtful and loss assets stood at 89.6 per cent, 3.6 per cent, 6.5 per cent and 0.3 per cent, respectively, as of end-March 2020.

Arabtec Holding PJSC to Enter Liquidation

The Dubai-based construction company that helped build the world's tallest building and other engineering marvels in the United Arab Emirates announced it would enter liquidation, the final step in a long collapse from the country's economic crisis a decade ago hastened by the coronavirus pandemic.
Arabtec Holding PJSC made the announcement after emails circulated among developers suggesting the firm's end had come. Despite trying to claw its way out of the chaos left of the chaos left by Dubai's 2009 financial crisis, the firm ended last year with hundreds of millions of dollars in debt and losses.
Arabtec chairman Waleed al-Muhairi said that after years of setbacks, the economic slowdown from the coronavirus pandemic severely hurt the company's projects.
Founded in 1975, Arabtec has built both skyscrapers and the infrastructure needed to pump oil and natural gas in this OPEC-member nation. It helped build the Burj Khalifa, the centerpiece of modern downtown Dubai that at 2,717 feet (828 meters) is the world's tallest building. It also built the Louvre Abu Dhabi, Abu Dhabi's Emirates Palace hotel and a major centerpiece of Dubai's upcoming Expo 2020 world's fair.

Oct 03, 2020

Tesla Reports Record Vehicle Deliveries in Q3 Despite Pandemic

Electric-car maker Tesla has delivered a record 1,39,300 vehicles in the third quarter, beating the earlier estimates of 1,34,720 vehicles.
The company produced 1,28,044 Model 3 and Model Y vehicles and delivered 1,24,100 of those.
As for the Model S and Model X, it produced 16,992 of the vehicles and delivered 15,200.
The company is expecting to deliver 5,00,000 vehicles in 2020, or a 36 per cent increase over 2019.
So far the EV maker has only sent out 3,18,350 cars to customers, meaning it would need to make 1,81,650 deliveries to meet that goal.

Exports Rise, Trade Deficit Narrows

According to data released by the commerce ministry, after contracting for six months in a row, the country's exports grew by 5.27% year-on-year to $27.4 billion in September, while imports slipped by 19.6% to $30.31 billion.
The trade deficit during the month under review narrowed to $2.91 billion as against $11.67 billion in the same period of 2019. The exports in September last year stood at $26.02 billion.
Exports during April-September this fiscal dipped by 21.43% to $125.06 billion. Imports during the period stood at $148.69 billion, recording a negative growth of 40.06%. Commodities that registered positive growth in exports in September include iron ore, rice, oil meals, carpet, pharmaceuticals, meat, dairy and poultry products, cotton yarn/fabrics/made-ups, handloom products, tobacco, spices, petroleum products, engineering goods, chemicals and coffee.
The ministry said that in September 2020, oil imports fell 35.92% to $5.82 billion. During April-September 2020-21, it contracted 51.14% to $31.85 billion.
Non-oil imports in September too declined by 14.41% to $24.48 billion. The imports during the first half of the current fiscal declined 36.12% to $116.83 billion.

Tesla CEO Musk Hints at India Entry Next Year

Tesla Inc Chief Executive Elon Musk indicated that the US electric carmaker will make a foray into India in 2021.
Tesla's entry could come at a time when Prime Minister Narendra Modi is increasingly becoming focused on promoting the use and manufacture of electric vehicles.
India's auto sector, already reeling from a slowdown in demand last year, has been further hit by the novel coronavirus pandemic and carmakers are seeking government support to push sales.

India Post Payment Bank Achieves 3.6 crore Custombers

The India Post Payment Bank, even amid COVID-19 pandemic, has attained 3.6 crores of customers. Till September 15, 2020, the bank had completed 38,500 crores of financial transactions.
In August 2019, it had crossed the milestone of one crore customers. This has been achieved by the bank in just two years of launch. The main reason behind the success of the bank is Aadhaar Enabled Payment System Service (AEPS). The AEPS helped to extend the banking and financial services to millions of unbanked and poor.
The top three circles that performed well in AEPS transactions were UP, Bihar and Gujarat. UP recorded 61.7 lakh transactions. Bihar and Gujarat recorded 20 lakh and 16.9 lakh transactions respectively.
The AEPS transactions helped to provide door step banking to old age pensioners, sick and elderly and Divyangs.
The IPPB platform through AEPS transferred the DBT benefits of Pradhan Mantri Garib Kalyan Yojana to local post offices.
The IPPB was launched by PM Modi on September 1, 2018. IT aimed to avail banking services at people's door step. It is a payment bank that works through network of post offices. The banks are operated by the Indian Postal Department. It aims to build most affordable, accessible and trusted bank for common man. Also, it focuses to achieve financial inclusion for under banked populace. The bank is governed by Reserve Bank of India.

Billionaire British Brothers and TDR Buy Walmart's Asda

The British billionaire Issa brothers and private equity group TDR Capital have agreed to buy the British supermarket chain Asda from Walmart for $8.8 billion to take on rivals such as Tesco with new smaller stores.
The deal, led by Mohsin and Zuber Issa who founded the petrol station operator EG Group nearly two decades ago, and TDR means Asda will be back under British ownership for the first time since 1999, when Walmart paid 6.7 billion pounds for the business.
The new owners said that they would look to drive growth at Asda by expanding its presence into smaller neighbourhood shops from its primarily large supermarket format, bringing it more in line with larger competitors Tesco and Sainsbury's which offer both.
Walmart will retain an equity investment in the business, with an ongoing commercial relationship and a seat on the board.

Oct 02, 2020

Tribes India E-market Place

The Union Minister of Tribal Affairs Arjun Munda is to launch the largest handicraft and organic product market place called "Tribes India E-Market Place". The market place is an initiative of TRIFED (Tribal Cooperative Marketing Development Federation of India).
Keeping in line with the vision of the Prime Minister of making India Aatmanirbhar and self-reliant,this pathbreaking initiative of TRIFED under Ministry of Tribal Affairs will showcase the produce and handicrafts of tribal enterprises from across the country and help them market their produce/ products directly, is also a major leap towards the digitisation of tribal commerce.On this occasion, Shri Munda will also flag off several other TRIFED initiatives that are aimed to support the tribal brethren. These include the inauguration of Tribes India's 123rd and 124th outlets in Rishikesh and Kolkata; inclusion of new tribal product ranges from the states of Jharkhand and Chhattisgarh; partnership of TRIFED/ Tribes India with Amazon in their Seller Flex program. Sh Arjun Munda will also launch Pakur Honey by Trifed & Tribes India. It is 100% natural honey which is Multi Floral , Forest Fresh, gathered by Santhal Tribals and Vulnerable Pahadhiya tribes from Pakur, Jharkhand.
Tribes India e-Marketplace is an ambitious initiative through which TRIFED aims to onboard 5 lakh tribal producers for sourcing of various handicraft, handloom, natural food products across the country and brings to you the best of tribal produce. The suppliers comprise of individual tribal artisans, tribal SHGs, Organisations/ Agencies/ NGOs working with tribals. The platform provides the tribal suppliers with an Omni-channel facility to sell their goods through their own retailers and distributors, TRIFED's network of Outlets and eCommerce partners as well as their own account in e-Marketplace.

Andhra Pradesh and Uttar Pradesh Get Additional Borrowing Limit

The states of Andhra Pradesh (AP) and Uttar Pradesh (UP) have been granted an additional borrowing limit of Rs. 7,106 crore based on reforms in the public distribution system (PDS) and the ease of doing business (EoDB).
While UP has been permitted to borrow Rs 4,851 crore on account of One Nation One Ration Card System (ONORCS) reforms under the PDS, AP will be allowed to undertake open market borrowings of another Rs 2,252 crore for making the state more investor and business-friendly.
This makes AP the first state to achieve the second tranche of the additional borrowing limit of 0.25% of gross state domestic product (GSDP)
On September 24, five states including AP, Telangana, Goa, Tripura and Karnataka were granted the increased borrowing limit after implementing the PDS related reforms.

ShareChat Inks Global Music Licensing Deal with Times Music

Indian social media platform ShareChat signed an agreement with Times Music to license the latter's music catalogue on its platforms.
The partnership will include Punjabi Music catalogue of Speed Records, which boasts largest market share in Punjabi music and has some of the top Punjabi Hits like 'Lamberghini',' Mann Bharrya' and others.
The collaboration would enable more than 240 million users of ShareChat and Moj (its short video platform) to access an exhaustive library of Times Music and Speed Records to create content on the two platforms, bringing a more immersive experience.
Times Music's library includes Bollywood, Spiritual, Indie, Pop, Rock and other non-film music genres.
The partnership with Times Music is one such step to bolster ShareChat's music library and give wings to the creator's creativity.

Six PSBs Excluded from Schedule II of RBI Act

The Reserve Bank of India excluded six public sector banks from the Second Schedule of RBI Act. This was done following their merger with other banks. These six banks are Oriental Bank of Commerce (OBC), Syndicate Bank, United Bank of India, Corporation Bank, Andhra Bank and Allahabad Bank.
There were 27 Public Sector Banks in 2017. Their count has now come down to 12 with seven large PSBs and five smaller PSBs. The OBC and United Bank of India were merged into Punjab National Bank. The Syndicate Bank was merged with Canara Bank and Andhra Bank and Corporation Bank were merged into Union Bank of India and Allahabad Bank was merged into Indian Bank.
A bank that is mentioned in the Second Schedule of the RBI Act is called as the Scheduled Commercial Bank.
Every bank listed in the schedule II of RBI act is a Scheduled Bank. In order to enter the category, a bank should hold a paid-up capital of Rs 5 lakh (minimum). These banks are eligible for loans from RBI at bank rate.
Those banks that are not listed in Schedule II of the RBI act are non-scheduled banks. They are not eligible to receive loans from RBI.
A Commercial Bank can be a scheduled or a non-scheduled bank. They operate on profit basis. They extend loans to businesses, public and government.

Oct 01, 2020

Government Extends Deadline to Bid for BPCL Till November 16

The government has for the fourth time extended the deadline for bidding for privatisation of India's second-biggest oil refiner Bharat Petroleum Corp Ltd (BPCL) by one and a half month to November 16.
While the Cabinet, in November last year, had approved the sale of the government's entire 52.98 per cent stake in BPCL, offers seeking expression of interest (EoI) or bids showing interest in buying its stake were invited only on March 2020.
Initially, the EoI submission deadline was May 2, but it was first was extended up to June 13, then to July 31 and later to September 30.
The government is keen to close the sale before March 31, 2021, to help meet a record Rs. 2.1 lakh crore target which Finance Minister Nirmala Sitharaman has set from disinvestment proceeds in the Budget for 2020-21.
But with this extension, the sale being completed by March 2021 looks doubtful as after EoIs come in, the government will open a data center for interested bidders to conduct due diligence, only after which financial bids will be called.
The financial bids will have to be evaluated and approved by the Cabinet and the transaction will close once the payment is made.

General Atlantic Picks Up Stake in Reliance Retail

Global private equity firm General Atlantic will invest Rs. 3,675 crore to buy a 0.84% stake in Reliance Industries' retail arm, extending the fundraising spree by Mukesh Ambani-led firm.
This is the third private equity investment in Reliance Retail, following US-based private equity firm Silver Lake's Rs. 7,500 crore investment for a 1.75% stake and global private equity firm KKR's Rs. 5,550 crore investment for a 1.28% stake earlier this month.
This marks the second investment by General Atlantic in a subsidiary of Reliance Industries, following a Rs. 6,598.38 crore investment in Jio Platforms announced earlier this year.
Reliance Retail operates India's largest, fastest-growing and most profitable retail business spanning supermarkets, consumer electronics chain stores, cash and carry wholesale business, fast-fashion outlets, and online grocery store JioMart.

India Asks Bangladesh to Reduce Duty on Apparel Imports

India has asked Bangladesh to remove duties on its apparel imports and said that the two sides can together capture 35% of the global market for textiles in the next five years and replace China.
Textile minister Smriti Zubin Irani said that when we compare our share of imports in Bangladesh with China, China stands at 54% and India is at 17% given the high tariffs on Indian textiles and apparel export products. Indian industry can rejoice if Bangladesh allows retail of ethnic apparel from India at zero duties.
India is also actively looking at addressing logistics challenges at its borders to facilitate quicker turnaround times for both the industries in India and Bangladesh.

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