General Awareness

BUSINESS AND ECONOMY - October 2018

Oct 2018

Nov 08, 2019

Hero MotoCorp Launches India's First BS-VI motorcycle Splendor iSmart at Rs 64,900

India's largest two-wheeler maker Hero MotoCorp launched its first BS-VI emission norm compliant product - Splendor iSmart - at Rs 64,900.
The launch comes exactly one week before estranged partner and arch rival Honda Motorcycle and Scooter India is expected to launch a BS-VI compliant version of its mobike CB Shine.

IRDAI Bars Anil Ambani-Led Reliance Health Insurance From Selling Policies

Insurance sector regulator IRDAI has barred Anil Ambani-led Reliance Health Insurance Ltd (RHICL) from selling new policies due to its weak financial health.
The regulator has also asked RHICL to transfer the entire policyholders' liabilities along with financial assets to Reliance General Insurance Co Ltd (RGICL), which in turn will settle claims of the existing policyholders.

Mercedes-Benz Rolls Out Luxury 'V-Class Elite' at Rs 1.10 Crore In India

Mercedes-Benz launched 'V-Class Elite', a new luxury multi-purpose vehicle (MPV) at Rs 1.10 crore in the country.
The MPV has a 1950cc diesel engine and offers features such as massaging function on the luxury seats, a centre console with refrigerated compartment, surround sound system with 15 speakers, among other facilities.
The company will import V-Class Elite to the Indian market from Spain.

DIN System Of CBIC Comes Into Existence

The Documentation Identification Number (DIN) system of Central Board of Indirect Taxes (CBIC) will come into existence from November 8, 2019.
This path breaking system in indirect tax administration has been created as per the direction of Finance Minister Nirmala Sitharaman. Now, any CBIC communication will have to have a Documentation Identification Number.
To begin with, the DIN would be used for search authorisation, summons, arrest memo, inspection notices and letters issued in the course of any enquiry.
Any communication from GST or Custom or Central Excise department without a computer-generated DIN, would be treated as invalid and shall be non-est in law or deemed to be as if it has never been issued.
It will provide the taxpayer a digital facility to verify any communications.

Nov 07, 2019

India Gained $755 Million In Additional Exports To US Due To US-China Trade War: UNCTAD

India gained about $755 million in additional exports, mainly of chemicals, metals and ore, to the US in the first half of 2019 due to the trade diversion effects of Washington's tariff war with China.
The study, Trade and trade diversion effects of United States tariffs on China, shows that the ongoing US-China trade war has resulted in a sharp decline in bilateral trade, higher prices for consumers and trade diversion effects - increased imports from countries not directly involved in the trade war.

IMF Wants Govt To Be More Credible, Transparent On Fiscal Numbers

New Delhi needs to become more "transparent" on the fiscal numbers as it is a "laggard" among the G20 peers on this front, a senior official from the International Monetary Fund.
The government has been missing its budgeted fiscal targets for the past few years and there is a need for a "credible fiscal consolidation" which is more ambitious as well, the official said, adding this is more so as government has not addressed how it will make up for the massive Rs 1.45 trillion tax giveaways in the form of corporate tax cuts.

Maruti, Toyota Tsusho in JV For Vehicle Dismantling

Maruti Suzuki India and Japan-based Toyota Tsusho Group announced a new joint venture for vehicle dismantling and recycling, titled Maruti Suzuki Toyotsu India Pvt. Ltd.
While Maruti Suzuki India will own 50% in the joint venture, the remaining will be held by Toyota Tsusho Corporation and Toyota Tsusho India.
The venture would be headquartered in New Delhi and would set up its vehicle dismantling and recycling unit in Noida by 2020-21.

RBI Panel Moots Tighter Norms For CICs

A working group set up by Reserve Bank of India to review the regulatory and supervisory framework for core investment companies (CIC) has suggested that such entities should only have a two-tier structure, and stronger boards, with at least 50% independent directors.
It is suggested that capital contribution by a CIC in a step-down CIC, over and above 10% of its owned funds, should be deducted from its adjusted net worth.
Further, step-down CICs will not be permitted to invest in any other CIC, but can 'freely' invest in other group companies.

Nov 06, 2019

TechM Acquires US Firm BORN

Tech Mahindra has acquired New York-based marketing and media solutions agency BORN Group for up to $95 million (₹672 crore) in cash, a deal that the Indian technology company said would bolster its capabilities in ecommerce and customer experience domains.
The BORN Group provides services such as strategy consulting, content creation, digital production, and ecommerce and content management system implementations.
BORN was owned by PE funds True North Capital and Zodius Capital. Its client list includes Sotheby's, Red Bull, Skull Candy, Harley-Davidson, Ferragamo, Fossil, Ethan Allen, Thomas Pink, Glanbia, Tetley Tea and Maxim. A clutch of global and Indian ITES majors such as Accenture, Cognizant, IBM and Tech Mahindra were in race to acquire BORN.
Of this $95 million value, $25 million will be linked to the achievement of financial targets for the year ending December 31, 2019. Tech Mahindra will also acquire the Indian subsidiary of the BORN Group, BORN Commerce.
The BORN Group posted revenue of $50 million in 2018, compared with $39 million in 2017 and $36 million in 2016. The all-cash transaction is likely to be completed by November 15, 2019.
The BORN Group has offices in New York, London, Toronto, Tokyo, Singapore, Chennai and Pune. It employs more than 1,100 people. It has offshored much of its advertising business to offices in Chennai and Pune, and more than half of its team works in Chennai.

India Retains Third Spot in Global Unicorn List

India continues to reinforce its position as the third largest startup ecosystem across the world, as it added over 1,300 startups in 2019, taking the total number to 8,900-9,300 in the last five years, according to the report 'Indian Tech Startup Ecosystem - Leading Tech In the 20s' by Nasscom.
India also witnessed the addition of 7 Unicorns in 2019 till August, taking the total tally up to 24, which is the third highest number of Unicorns in a single country in the world.

Norms Tightened for Demat of Physical Shares

To rein in incidents of frauds that take place in converting physical shares into demat, Sebi put in place several extra layers of checks and balances.
These include a plan to build a master file of all physical shares currently held by investors with the depositories.
The markets regulator has asked listed companies to submit data of all shareholders holding physical shares to depositories by December 31, 2019.
In its circular, Sebi said the move was aimed at augmenting "the integrity of the system in processing of dematerialisation request in respect of the remaining physical shares".
After depositories receive the data from the companies, they should put in place systems to validate any demat request received after December 31, Sebi said.
The data would be validated against the demat account holders' names as available in the records of the depositories.
In case there is a mismatch in name on the share certificate and that of the beneficial owner of demat account, the depository system should generate an alert.
In case of such alerts, additional documents, including Aadhaar of the individual, would be sought.
And if there is a complete mismatch between the two data, the applicant can approach the issuer company or the RTA for establishing his or her ownership.

PMC Withdrawal Limit Raised to ₹50,000

Reserve Bank of India once again increased the withdrawal limit for PMC Bank depositors by Rs 10,000 to Rs 50,000.
This is the fourth time that the RBI has raised the limit. On September 23, when the crisis broke, the RBI capped the withdrawal limit at Rs 1,000 per depositor.
After protests and representations by depositors, politicians and bank unions, it increased the limit to Rs 10,000. In October, it was further increased to Rs 25,000 and then Rs 40,000.
The RBI, after reviewing the bank's liquidity position and its ability to pay its depositors, has decided to further enhance the limit for withdrawal to Rs 50,000, inclusive of Rs 40,000 allowed earlier.

Edelweiss is Top Bidder for 3 IL&FS Road Assets

Edelweiss has emerged as the highest bidder for three road assets put on the block by IL&FS. The committee of creditors met to discuss bids for the three projects and issues relating to these projects, whether to sell them before converting to green.
Edelweiss submitted the bids through its infrastructure fund for three assets — the Jorabat Shillong Expressway with a debt of ₹1,406 crore, the Jharkhand Infrastructure Implementation Co with a debt of ₹430 crore, the Hazaribagh Ranchi Expressway Ltd with a debt of ₹954 crore.
Two of the three projects are amber companies and a resolution framework is not yet accepted for amber companies by the court. The IL&FS resolution framework, as worked out by the new management and board, has categorised its group units into green, amber and red, based on their ability to meet payment obligations over the coming 12 months.
Those able to meet all payment obligations are green. Those that can only operational payments and senior secured debt obligations are categorised as amber. Those unable to meet obligations to even senior secured financial creditors are categorised as red.

Apple and Valve Partners to Work on AR Headset

Apple has reportedly partnered with the US game developer Valve to develop its rumoured AR headset, due for launch in 2020.
Earlier, noted analyst Ming-Chi Kuo said that the iPhone maker is preparing to release AR headsets by the first half of 2020.

Telegram Giving Tough Competition to Whatsapp

With WhatsApp facing heat over breach of user privacy, there is renewed focus on alternatives like Telegram that are gaining users in India.
Though still a long way from WhatsApp's 40 crore monthly users, serial entrepreneur Pavel Durovfounded Telegram is giving the Facebook-owned messenger app a tough fight with an over 60% rise in monthly active users in the past nine months.
Further, from a penetration rate of just 2% in June 2017, almost 12% of Telegram's global user base is in India as of September 2019. The rate of new installs too have tripled in 2019 — app intelligence firm SimilarWeb recorded around 91 lakh new installs of Telegram in India in September 2019 compared to 36 lakh installs in January 2019.
Another alternative is US-based Signal. Though open-source and more secure, it still remains a niche proposition in India with average monthly active users in 2019 at around 70,000, even as it has the strong support of privacy advocates such as Edward Snowden.
Telegram's encryption protocol 'MTProto' helps completely scramble and mask messages while in transit, and Signal's encryptions too virtually hides all of the metadata.

India Mulls Free Trade Pact with the US

A day after opting out of the China-backed RCEP (Regional Comprehensive Economic Partnership), the government said that it was exploring an agreement with the US, a move many see as a strategic shift.
At present, India is exploring trade agreements with the USA and the European Union, where Indian industry and services will be competitive and benefit from access to large developed markets.
For years, India has shot down suggestions of a free trade agreement with the US and had denied that there was any move when President Trump hinted at it in a tweet a few months ago.
The statement comes at a time when India and the US are seeking to cover the gap that separates the two sides on high tariffs on several products—ranging from Harley-Davidsons to fruits—and a possible restoration of a part of the preferential duty benefits for Indian exports under the generalised system of preferences (GSP) scheme.
In recent years, the US has emerged as a crucial ally for India though differences over trade issues often cast a shadow on the burgeoning partnership.
A trade deal with the US, at a time when worries over Chinese imports flooding the local market saw India walk away from RCEP, will underscore the growing convergence with the US as well as suspicions of the giant across the border.
In the past, lobby groups such as the US-India Strategic Partnership Forum have suggested that an FTA could hold the key to resolving disputes.
The US is India's largest trade partner with imports and exports adding up to $88 billion in 2018-19. With exports of $52.4 billion, India had a trade surplus of $16.8 billion.

Chaayos Forays into Bengaluru

Tiger Global-backed tea cafe chain Chaayos has forayed into Bengaluru with a plan to open 15 cafes across the city by March 2020.
Currently it operates 65 cafes across Delhi, Noida, Gurgaon, Faridabad, Chandigarh and Mumbai.
The tea cafe chain was founded in November 2012 by Raghav Verma and Nitin Saluja.

Eaton unveils First Aerospace Manufacturing Facility in India

US-based power management giant Eaton unveiled its first aerospace manufacturing facility in India.
The new facility, located in Bengaluru, will manufacture hose assemblies and other fluid distribution products, including oil debris monitoring systems, to serve commercial, business and regional aircraft.
With the opening of the Bengaluru facility, Eaton which posted sales of $21.6 billion in 2018, now operates 27 aerospace manufacturing locations around the world, including a joint venture in China.
The facility would be an integral part of the growth strategy for Eaton's aerospace business.
In the aerospace industry, Eaton is a leading supplier of products and technologies for hydraulic systems, fuel and inerting systems, motion control and engine solutions.
It serves commercial and military aerospace, marine and defence markets worldwide. For instance, Eaton has provided its aerospace product and technologies to support the missions of US space agency Nasa and also the Lockheed Martin F-35 Joint Strike Fighter aircraft.

Sebi Tightens Rules on Participatory Notes

India's capital markets regulator tightened rules on participatory notes (p-notes), or offshore derivative instruments issued by brokers to foreign investors not registered locally, while easing some operational norms for select overseas funds.
Foreign portfolio investors (FPI) would have to make separate registrations for issuing p-notes for underlying derivatives. However, this requirement is waived for p-notes against underlying cash equities.
Based on the new guidelines, some of the existing FPIs will have to get separate registrations if they want to issue p-notes based on derivatives.
The regulator also said that an ODI-issuing (offshore derivative instrument) overseas investor, which hedges its ODI only by investing in securities held by it in India, cannot undertake proprietary derivative positions through the same FPI registration. Such an FPI must segregate its ODI and proprietary derivative investments through separate FPI registrations.
P-notes are derivative instruments issued by registered foreign portfolio investors to overseas investors to enable them to trade in Indian stocks without having to register with Sebi.
"No fresh derivative position, not in compliance with the above requirements, shall be allowed henceforth.
FPIs have 90 days' time from the date of publication of the Operating Guidelines to comply with the above requirements," the Sebi order said.
"Offmarket transfer of assets/positions will be allowed for FPIs intending to transfer assets/ position from one FPI account to another FPI account to comply with the above requirements."
To be sure, the regulator has also relaxed some KYC norms for FPIs. It has exempted category I FPIs from submitting the information of their beneficial owners to custodians.
Market participants said that the regulator has also given more clarity on the KYC documents that need to be collected for each category of offshore funds.
The regulator has also put in place a data-privacy mechanism for sharing of KYC documents across market institutions, such as brokers and depositories. Going forward, all such data sharing will be consent based.
Further, global custodians have been allowed to rely on the documentation collected by their own bank in a different country. Hence, in some cases, leading global custodians will be able to onboard FPIs into Indian markets without any fresh KYC.

Asean to Conclude Review of FTA with India

The Association of South East Asian Nations (Asean) may soon conclude FTA (free-trade agreement) review with India. The aim is to balance China in the Indo-Pacific.
The grouping will work with India for early conclusion of the review of Asean-India FTA to keep momentum in the partnership.
PM Narendra Modi, while addressing 10 Asean leaders, welcomed the decision to have a relook at the free-trade agreement between India and the 10-member grouping. In October 2019, India and Asean initiated a review of the free-trade agreement in goods to make it "user-friendly, simple and trade facilitative".
After India's decision to stay out of RCEP, some Asean nations, including Thailand, are keen for early conclusion of the FTA review.
In 2003, India and Asean signed a Framework Agreement on Comprehensive Economic Cooperation to establish an Asean-India Regional Trade and Investment Area, which would provide a basis for subsequent FTAs covering goods, services and investment.
The Asean-India Trade in Goods Agreement (AITIGA) was signed in 2009 and it is this that both sides have agreed to review.
India has its concerns, given that its FTA with Asean is stacking up trade deficits with several Asean partners.

IndiGo eyes code-share deal with Qatar Airways

Qatar Airways has for years repeatedly expressed a desire to pick up a stake in India's largest airline IndiGo. Now the two aviation giants will finally make a "strategic business announcement", which could be of a code-share for now.
Qatar Airways group chief executive Akbar Al Baker is coming to Delhi, where he and IndiGo CEO Ronojoy Dutta talk about the vision and future for both the airlines.
Qatar Airways' Al Baker has been planning to start an airline in India. However, rules requiring that such an airline be substantially owned and controlled (SOEC) by Indians and an Indian entity have prevented that from happening.
Such an airline, even if formed, may face difficulties in flying abroad from India as other countries will see whether the same meets the SOEC norms and hence is a truly Indian carrier or not.

China Wants US to Drop Tariffs on Imports for Trade Deal

China is seeking the roll back of US tariffs on as much as $360 billion of Chinese imports before President Xi Jinping agrees to go to the US to sign a partial trade deal with President Donald Trump.
Negotiators asked the Trump administration to eliminate tariffs on about $110 billion in goods that were imposed in September 2019 and lower the 25% tariff rate on about $250 billion that began in 2018.
Chinese officials also suggested the US could temporarily waive some tariffs. In return, China could remove tariffs on a reciprocal amount of US goods, mostly farm products.
China has also previously demanded that Trump cancel plans to impose duties on roughly $160 billion in imports, scheduled for Dec. 15, which would hit consumer favorites like smartphones and laptops. At the very least, those tariffs have to be taken off the table for Xi to get on a plane to meet Trump.

PI Industries to Acquire Isagro (Asia) Agrochemicals

PI Industries will acquire 100% stake in Isagro (Asia) Agrochemicals for ₹345 crore as part of its plans to expand manufacturing capacity.
In a regulatory filing, PI Industries informed that the company along with its wholly-owned subsidiary PI Life Science Research has "executed a share purchase agreement".

ICICI Restructures Operations

ICICI Bank has restructured its operations to replace divisions based on functions with verticals servicing industry groups.
A fallout of this is that it will no longer have a project finance vertical, which was the mainstay of the erstwhile financial institution before the transitioning into a bank.
While ICICI Bank has been going slow on project loans, the lender's CEO Sandeep Bakhshi has repeatedly told investors that it was not exiting the business but would only fund projects that passed through its risk framework.
Under the new structure, there will be separate verticals that will deal with financial institutions, corporate groups, startups, brokers, REITs among different client groups. Sources in the bank said that in any case there were no new project proposals coming forward.

Reliance Scraps Project in Andhra

In what appears to be a blow to industrial growth in Andhra Pradesh, Reliance Industries has withdrawn from its Rs 15,000-crore electronics manufacturing hub near Tirupati.
In February 2018, Reliance had signed an MoU with then TDP government to manufacture mobiles, TV sets and set-top boxes among other electronic gadgets in 150 acres at Renigunta. Reliance had planned to manufacture 10 million mobiles annually from the plant.
Delay in land procurement and legal issues prompted Reliance to withdraw from the project.

Nov 05, 2019

HCP Design Awarded Contract For Redesigning

HCP Design was awarded the contract for redesigning the Central Vista. It was the highest bidder among the four firms that qualified for the financial round for the project, according to the bid documents.
To be sure, a competitive bidding process — termed Quality and Cost Based Selection — was adopted to choose the designer, giving 80% weightage to the technical scores and 20% to financial scores.
A five-member jury led by PSN Rao, director of the School of Planning and Architecture (SPA), Delhi selected the winner.
The Centre announced that the final contract for the ambitious redesign of New Delhi's Central Vista, or Rajpath, the seat of power in the national capital, was awarded to Ahmedabad-based HCP Design, Planning And Management Private Limited.

Half Of Private Bank's Chief's Salary To Be Linked To Performance

The Reserve Bank of India (RBI) said chief executives of banks should have at least half of their pay based on performance, as the regulator tries to tweak incentives to prevent the reckless risk-taking that has burdened India's lenders with record bad loans.
Employees were often rewarded for increasing short-term profit without adequate recognition of the risks and long-term consequences that their activities posed to the organizations.
Misaligned compensation practices, especially of large financial institutions, were among the important factors that contributed to the global financial crisis in 2008.

ADB to Give USD 451 mn for Chennai-Kanyakumari Industrial Corridor Power Links

The Asian Development Bank said it will provide a USD 451 million (about Rs 3,200 crore) loan to strengthen power connectivity between the southern and northern parts of the Chennai-Kanyakumari Industrial Corridor (CKIC) in Tamil Nadu.
The total cost of the project is USD 653.5 million, of which the government will provide USD 202.5 million.
The estimated completion date is the end of 2024.

Tata Global Beverages to Change Nomenclature

By March 2020, Tata Global Beverages Ltd. (TGBL) expects to become Tata Consumer Products Ltd., emerging as an FMCG company with a portfolio of food products and marking a significant expansion beyond its present play in the beverage segment only.
It is now undergoing the process of a scheme of arrangement with Tata Chemicals Ltd. (TCL).

Nov 04, 2019

Led By India, South Asia Moving Towards Becoming Center Of Global Growth: IMF

Led by India, South Asia is moving towards becoming center of global growth and could contribute about one-third of the world's growth by 2040, according to a latest research by the International Monetary Fund.
Notably, under the IMF's geographical division of the world, South Asia does not include Afghanistan and Pakistan. For IMF, South Asia includes India, Bangladesh, Nepal, Sri Lanka, Bhutan, and Maldives.

Aditya Birla Group Celebrates 50 Years In Thailand

The event was attended by Prime Minister Narendra Modi and several other dignitaries from the Thai and Indian government.
Diversified conglomerate Aditya Birla Group (ABG) celebrated its 50 years of operations in Thailand.
Aditya Vikram Birla had made a foray into Thailand by setting up a spinning unit.

World's most profitable company to go public

Saudi Aramco has confirmed that it is planning to list on the Riyadh stock exchange, in what could be the world's biggest initial public offering (IPO).
The state-owned oil giant will determine the IPO launch price after registering interest from investors.
The Saudis are expected to make shares available for 1% or 2% of the firm, and the offer will be for existing company shares.
Saudi Aramco is thought to be worth about $1.2tn (£927bn).

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