General Awareness

BUSINESS AND ECONOMY - October 2018

Oct 2018

May 10, 2019

Trump Sanctions Iran's Industrial Metals Sectors

The Trump administration announced new sanctions against Iran targeting its industrial metals sectors, which is the country's largest non-petroleum export revenue earner, and warned of further actions unless Teheran fundamentally alters its conduct.
The new curbs impact Iran's iron, steel, aluminium and copper sectors, that account for 10% of its economy, and go into effect after 90 days during which countries and businesses are expected to wind down ongoing arrangements, or face sanctions.

RIL Arm Buys Hamleys

Reliance Brands, a subsidiary of Reliance Industries Ltd. (RIL), has signed a definitive agreement with C Banner International, a Hong Kong-listed company, to acquire 100% shares of centuries-old British toy retailer Hamleys for £68 million.
The 250-year old English toy retailer pioneered the concept of experiential retailing, decades before the concept of creating unique experience in brick and mortar retailing become the new global norm.
The worldwide acquisition places Reliance in the frontline of global retail.

Bank Credit Grows

Bank credit grew by 13.2% in financial year 2018-19 as compared to 10.3% in the previous financial year (2017-18), mainly aided by loans to services and retail sector.
Deposit growth also gained momentum, growing by 10% as compared to 6.7% in 2018.
Banks typically tend to push for more loan disbursement and also try to get more deposits ahead of the end of a financial year to shore up their balance sheet and meet year-end targets.

Rajiv Gandhi International Airport among Top 10 Airports

According to a survey conducted by AirHelp, a company which deals with the rights of air passengers, the Rajiv Gandhi International Airport (RGIA) in Hyderabad was ranked among one of the top 10 airports in the world.
According to the survey, Hamad International Airport in Doha in Qatar was rated the world's best airport with 8.39 out of 10, followed by Tokyo International Airport in Japan and Athens International Airport in Greece.
The Hyderabad airport was ranked eighth, with a score of 8.27 out of 10, just below Singapore's Changi Airport and above the Tenerife North Airport in Spain.

Sri Lanka to Buy Buses from ALL

Sri Lanka will purchase 325 buses worth $21.2 million from Ashok Leyland Ltd. (ALL). The decision was taken following Cabinet approval to a proposal submitted by Minister of Transport & Civil Aviation Arjuna Ranatunga, for the purchase of 272 high-back, 50-seater buses, and 33 buses that seat 53 persons, for the Sri Lanka Transport Board.
As per a release from Lanka Ashok Leyland, a joint venture company set up with the Government of Sri Lanka, the purchase is to be made under a lease agreement, allowing Sri Lanka to pay the cost over a period of five years.

Time to Break Facebook

Facebook Inc co-founder and former Mark Zuckerberg roommate Chris Hughes called for the break-up of the world's largest social media network.
Hughes joins U.S. lawmakers who have also urged anti-trust action to break up big tech companies as well as federal privacy regulation.
Facebook has been under scrutiny from regulators around the world over its data sharing practices and hate speech and misinformation on its networks.
Facebook's social network has more than 2 billion users across the world.
It also owns WhatsApp, Messenger and Instagram, each used by more than 1 billion people.
Facebook bought Instagram in 2012 and WhatsApp in 2014.

Morgan Stanley Downgrades RIL

Morgan Stanley has downgraded Reliance Industries Limited's (RIL) stock to 'equal weight' (EW), leading to a 3.41% fall in the company's shares.
With this fall, the company has again lost the tag of India's most-valued firm to Tata Consultancy Services (TCS) as RIL's market capitalisation fell to Rs. 7,98,628.55 crore compared with TCS's Rs. 8,13,779.67 crore.

McDonald's Ends Dispute with Bakshi

Estranged partners McDonald's and Vikram Bakshi announced an out-of-court settlement, ending their almost six-year-long dispute.
As part of the agreement, the U.S. fast food chain will buy out for an undisclosed sum Mr. Bakshi and his entities' 50% stake in Connaught Plaza Restaurants Pvt. Ltd. (CPRL) that operates McDonald's chain of quick service restaurants in northern and eastern India.
The company also announced the appointment of Robert Hunghanfoo as head of CPRL with immediate effect.
CPRL is now wholly owned by MIPL and its affiliate MGM (McDonald's Global Markets LLC) following the completion of a settlement reached with former JV partner, Vikram Bakshi.

India to Add 3 Million Tech Jobs

According to the Indian Staffing Federation (ISF), the apex body for the 'flexi' working industry, Indian tech industry will add another three million new jobs in the next five years.
With the additions, the size of the country's tech army will be 7 million by 2023.
As per Rituparna Chakraborty president, ISF, all these new jobs would come up in digital technology areas such as artificial intelligence (AI), machine learning, Internet of things (IOT), data science, analytics, big data, block chain and augmented reality.
Jobs would also be created in newer technology areas that are presently unknown but are expected to emerge and evolve in the next few years.

May 09, 2019

Softbank to Raise Stake in Yahoo Japan

Japanese telco SoftBank Corp. said that it would spend $4 billion to up its stake in Yahoo Japan Corp. and turn the internet company into a subsidiary, a move that would help boost its profit by 24% this year.
The telco would buy 456.5 billion yen ($4.2 billion) worth of new shares to be issued by Yahoo Japan, increasing SoftBank Corp.'s stake to 45% from 12%.
With that addition, SoftBank Corp., which listed in December in Japan's largest-ever initial public offering, forecast its operating profit would rise to 890 billion yen in the current financial year through March 2020.

Flipkart Launches Online Grocery Store

In a view to capture a large market share of the online grocery segment, leading e-commerce player Flipkart launched its online grocery store Flipkart Supermart in Mumbai.
The Walmart-owned company had started its online grocery business a year and a half ago and is present in Bengaluru, Chennai, Hyderabad and Delhi.
It has set up a fulfillment centre in Bhiwandi for groceries. It offers 10,000 products, including 600 to 700 of its private labels.

Rollback of Toll Tax in South Kashmir

Several bodies of traders and transporters as well as the political parties in the Valley asked the National Highways Authority of India to roll back the decision to impose toll tax in south Kashmir.
The NHAI has set up a toll post at Kachkoot Fee Plaza in Sangam and imposed Rs. 85 as tax, in the first ever such measure in the Valley for light motor vehicles.

May 08, 2019

HDFC to auction part of Jet Godrej BKC tower

HDFC has announced it will auction part of the 'Jet Airways Godrej BKC' building in Bandra Kurla Complex after Jet failed to pay back a loan of Rs 414.80 crore.
HDFC has set a reserve price of Rs 245 crore for the fourth floor of the tower measuring 52,775sqft. The e-auction will be held on May 15.
Jet Airways, which shut down recently, had bid Rs 826 crore during an MMRDA auction to develop the BKC plot in 2008.
Later, the cash-strapped airline tied up with Godrej Properties in 2011 to jointly develop the plot. In 2015, drugmaker Abbott India bought 4.35 lakh sqft space in the building for Rs 1,479 crore.
HDFC said the property was mortgaged to it by Jet and it was now enforcing the mortgage.

RBI Plans More Forex Swaps

The Reserve Bank of India (RBI) will probably conduct at least one more swap of rupees for dollars after the general election, part of an effort to support economic growth.
The central bank also plans to conduct open market operations of up to Rs. 50,000 crore over the next two months June and July, expanding a quantitative easing programme to spur the slowing economy.
These latest moves are expected to increase cash in the financial system and help push interest rates down, potentially helping borrowers where an interest rate cut has not.

Indian Oil's R&D Centre Crosses Milestone of 1,000 Patent Filings

Indian Oil Corporation's (IndianOil) Research and Development centre at Faridabad crossed a major milestone by filing its 1,001st patent, the first among Indian oil and gas PSUs to do so.
The R&D centre's IP (Intellectual Property) portfolio comprises 794 active patents, of which 542 patents were granted abroad and 252 in India.
The centre has also registered a healthy commercialisation rate for its patents, higher than the global average.

US could Delay Action on Oil,Trade Sanctions till June

India and the US won't immediately escalate vexed trade-related issues and are expected to hold their position on all important matters till a new government is formed in New Delhi by May end.
US commerce secretary Wilbur Ross too hinted the two sides will maintain their positions in his speech at the Trade Winds business forum, while raising the issue of trade imbalance with India.
India's main concerns include the US's decision to enforce sanctions on oil imports from Iran and the withdrawal of benefits under the Generalized System of Preferences (GSP) programme.
Washington is concerned by the trade imbalance because of tariff and non-tariff barriers, and regulations that US officials say put foreign companies at a disadvantage.

Royal Enfield recalls 7,000 Bullet, Electra

Niche bike maker Royal Enfield on Tuesday announced the recall of nearly 7,000 units of its Bullet and Bullet Electra models to rectify a faulty brake caliper bolt.
The company said it is undertaking a proactive field service action concerning the two models manufactured between March 20, 2019 and April 30, 2019.
Brake caliper bolt is an essential part of the braking system securing brake hose and brake caliper.

Piramal, CPPIB in Tie-up for India's First Renewable InvIT

Piramal Enterprises Ltd has signed an agreement with Canada's largest pension fund manager, Canada Pension Plan Investment Board (CPPIB), to co-sponsor India's first renewable energy-focused infrastructure investment trust (InvIT).
The proposed InvIT will have an initial targeted corpus of up to $600 million with an option to scale up further. CPPIB and Piramal will initially allocate $360 million and $90 million, respectively, to the corpus.
The InvIT would seek to acquire up to 1.5-2 gigawatts (GW) of stable and long-term cash-generating renewable assets, with a firm focus on diversification of clients of both solar and wind assets as well as the customers of the electricity.
Both Piramal Enterprises and CPPIB will act as co-sponsors of the proposed InvIT and hold up to 75% of the units with CPPIB holding up to 60% and Piramal holding 15%.
The two co-sponsors will seek to raise capital from other investors for the remaining 25%.
The latest tie-up with CPPIB adds to Piramal's other ventures with marquee long-term investors.
In February 2017, Piramal entered into a strategic partnership with Ivanhoé Cambridge, a real estate subsidiary of Caisse de dépôt et placement du Québec, Canada's second-largest pension fund, to provide longterm equity capital to top residential developers across five Indian cities.
In 2016, the company set up a distressed asset investment platform, along with private equity firm Bain Capital Credit, in order to invest $1 billion in stressed assets.

Bankruptcy Process Starts for RCom

Lenders to the crippled Reliance Communications (RCom) moved the NCLT to appoint a new resolution professional and form a committee of creditors — the first step to begin the bankruptcy process of the Anil Ambani group company that owes close to Rs 50,000 crore to 31 lenders led by State Bank of India.
RCom through existing resolution professional, sought 13 months' exclusion in insolvency process, citing the stays it had on the process by the appellate tribunal and the Supreme Court.
The RP sought the exclusion from April 30, 2018 to May 30, 2019. RCom was in trouble for years, forcing it to discontinue operations two years ago.
Its effort to stave off bankruptcy by selling spectrum to Reliance Jio got scuttled after the long legal and government delays for approvals.

Eros Tweaks Terms of Planned Dollar Bond Offering

A Bollywood filmmaker that was spurned by credit investors several years ago is changing the terms on a planned dollar bond offering after money managers balked again, as signs of caution in global debt markets mount.
Eros International Plc is tweaking its plan after holding road shows in April, at a time when investors have been inundated with dollar bond supply and US-China trade tensions are bringing more volatility to markets.
In a novel twist, the maker of films with stars such as Priyanka Chopra and Salman Khan now plans to offer notes that will be secured against its library of more than 12,000 film titles available to global viewers via its platform Eros
Now, after having sought an unsecured structure in April.
It pulled a dollar bond offering two years ago after investors demanded higher yields.
A surge in Asian dollar note sales is testing investor appetite after the market's best rally in years.
Buyers of Indian firms' overseas debt have also faced issuance that has reached records in 2019.
Billionaire Mukesh Ambani's Reliance Industries. acquired a 5% stake in Eros in 2018.

May 07, 2019

India and China Join Hands

As per reports, India and China are working closely on common trade concerns, including cooperation in buying oil and gas, against the backdrop of a US squeeze through tariffs and sanctions on Iranian oil imports.
Following a visit to New Delhi in March by Li Fanrong, deputy chief of China's National Energy Administration, the two sides created a joint working group on oil and gas.
This is the first institutionalised arrangement between the two sides to cooperate in energy though they have several groups on issues such as counter-terrorism and the boundary dispute.

U.S. Firms to Join Department of Commerce

The U.S. Commercial Service will bring more than 100 U.S. companies to India as part of the U.S. Department of Commerce's largest annual trade mission program, 'Trade Winds'.
Trade Winds Indo-Pacific features a three-day business forum in New Delhi, with additional trade mission stops in Ahmedabad, Chennai, Kolkata, Mumbai, Bengaluru, Hyderabad and Bangladesh.
At each mission stop, the attending companies will meet directly with government leaders, market experts and pre-vetted potential business partners.

Kolhapur Airport Registers Passenger Footfall

The Chhatrapati Rajaram Maharaj airport, also known as the Kolhapur airport has recorded 21,000 passenger footfall in 620 flight operations over the past five months.
Authorities are considering this as a good sign, considering the airport began operations in April 2018.
A weather department has been established on the airport premises.All airlines will now be updated with weather forecast at 7am every day.
Suresh Prabhu, Union Civil Aviation Minister in February, laid the foundation stone for a new terminal building and air traffic control (ATC) tower at the Kolhapur airport.

RBI Raises Cap on Home Loans

The Reserve Bank of India increased the eligibility cap on home loans extended by regional rural banks and small finance banks to Rs. 35 lakh in metropolitan areas and Rs. 25 lakh in other centres, provided the overall cost of the dwelling unit in the metropolitan centres and other centres does not exceed Rs. 45 lakh and Rs. 30 lakh.
All such loans will be now classified by these banks as priority sector loans.
In addition, the existing family income limit of Rs. 2 lakh per annum to be eligible for loans for housing projects exclusively for construction of houses for Economically Weaker Sections (EWS) and Low Income Groups (LIG) is revised to Rs. 3 lakh per annum for EWS and Rs. 6 lakh per annum for LIG, in alignment with the income criteria specified under the Pradhan Mantri Awas Yojana.

Discom Debt to Return to Pre-UDAY Levels

Aggregate external debt of State-owned electricity distribution companies (discoms) is set to increase to pre-Ujwal Discom Assurance Yojana (UDAY) levels of Rs. 2.6 lakh crore by the end of this fiscal, according to Crisil's analysis of discoms in 15 States, which account for 85% of the aggregate losses.
As per Crisil, with most States having limited fiscal headroom, continuous financial support to their discoms may be difficult.
So discoms have to become commercially viable through prudent tariff hikes and a material reduction in aggregate technical and commercial (AT&C) losses.
As per the MoUs States had signed under UDAY in fiscal 2016, their discoms were to initiate structural reforms by reducing AT&C losses by 900 basis points (bps) to about 15% in fiscal 2019, and also implement regular tariff hikes of 5-6% per annum.
In lieu, State governments took over three-fourths of discom debt, thus reducing the interest cost burden.
While discoms enjoyed the benefit of debt reduction, structural reforms have been slow to come by.

Mastercard to Invest in India

Mastercard announced a $1 billion investment in India over the next five years aimed at converting India into a vital node in the company's infrastructure, and also to continue business expansion.
According to Ari Sarker, co-president, Asia Pacific at Mastercard, what is interesting in this investment is that roughly $300 million is going to go into an investment where India will become a part of our global technology nodes of our network.
Mastercard has previously invested $1 billion in India over the last five years.

May 06, 2019

U.S. to Hike Tariffs on Chinese Goods

President Donald Trump announced that the U.S. would raise tariffs on $200 billion of Chinese goods to 25%, because trade talks are moving too slowly.
Mr. Trump's action came ahead of the arrival of a major Chinese delegation to Washington for the latest round of talks, a round, it is believed, could possibly lead to a deal.
For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods.
The two sides have imposed tariffs on $360 billion in two-way trade since 2018.

Ficci Seeks Government's Intervention

Industry body Ficci has sought the government's intervention for early resumption of mining in Goa, claiming that the Rs 3,400-crore sector that contributes around 10-12 per cent to the state GDP was under severe threat due to the apex court quashing mining leases.
The sudden discontinuance of mining operations in Goa is creating a huge loss to the mineral sector as a whole.
A sizeable population of Goa is directly or indirectly dependent on mining activities.
The Supreme Court judgement dated February 7, 2018, quashed the second renewal of iron ore mining leases given to 88 companies in Goa in 2015.
According to the apex court's previous judgements, only fresh leases were to be granted by the Goa government, not second renewals.

Anti-dumping Duty on Saccharine

The Finance Ministry has, on the recommendations of the Commerce Ministry, imposed an anti-dumping duty of $1,633.17 per tonne on the import of saccharine from Indonesia.
Saccharine is a compound most commonly used in sugar-substitute sweeteners.
Indonesia, until recently, accounted for a large chunk of India's saccharine imports.
In 2017-18, India imported $4.36 million worth of saccharine from Indonesia, which is 43% of the total imports of the sugar-substitute compound.

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