General Awareness

BUSINESS AND ECONOMY - June 2020

Jun 2020

Feb 11, 2021

PNB Inks Deal with Indian Oil to Provide up to Rs. 2 crore Loan to Dealers

State-owned Punjab National Bank (PNB) has inked a pact with Indian Oil Corporation to provide up to Rs. 2 crore to the oil company's dealers.
Punjab National Bank (PNB) signed a memorandum of understanding (MoU) with India Oil Corporation Ltd to cater to the financing needs of the Indian Oil dealers.
The MoU would benefit dealers with credit facilities at lower interest rates, nil margin, and with minimum or zero collateral requirements through the PNB e-Dealer scheme.
Understanding the financial requirements and providing ease of banking services, PNB electronic dealer finance scheme is a tailor made credit lending product crafted for the Indian Oil dealers.

SEBI Plans to Introduce Framework to Compensate Investors for Technical Glitches

Markets regulator SEBI is considering a proposal to introduce a framework to ascertain the incidents of technical glitches whereby compensation would be given to investors.
Besides, the regulator is also looking to devise a methodology and calculation of compensation.
Further, to improve the efficacy of liquidity enhancement measures such as market making, Liquidity Enhancement Scheme (LES) and call auction mechanism for illiquid securities, SEBI would review the existing framework.
The regulator is also considering a proposal to ascertain the optimum corpus for the Investor Protection Fund (IPF) of the stock exchanges on the basis of rigorous stress testing, to ensure that the legitimate claims of the clients of the defaulting members or brokers even in extreme times are met.

Cabinet Approves Rs. 100 crore Grant-in-aid for Brahmaputra Valley Fertilizer

The Cabinet Committee on Economic Affairs approved a grant-in-aid of Rs 100 crore to the Brahmaputra Valley Fertilizers Corporation Limited (BVFCL) at Namrup in upper Assam's Dibrugarh district to sustain operations of its urea manufacturing units.
BVFCL Namrup is a Public Sector Undertaking (PSU) formed as per the Companies Act under the administrative control of the department of fertilizers.
The company currently is operating its two vintage plants – Namrup-ll and Namrup-lll – in the premises of BVFCL at Namrup.

SBI Eyes Doubling of Mortgage Portfolio in 5 Years

State Bank of India (SBI), the country's largest lender, is looking to scale up its home loan business in a big way, cashing in on the demand from the younger population and leveraging its low-cost borrowing. The public sector bank, which took a decade to grow its mortgage portfolio to Rs. 5 lakh crore from Rs. 89,000 crore in 2011, is now aiming to cross the Rs.10-lakh-crore-mark over the next five years.
The home loan book is now the single-largest portfolio in the asset base of SBI. When it comes to demand, every third borrower happens to be from SBI.
Currently, SBI dominates the home loan segment with 34 per cent market share and its portfolio stood at Rs. 4.84 lakh crore as on December 31, 2020.

South Sudan Issues New Banknote

South Sudan's central bank introduced a banknote of 1,000 South Sudanese pounds (SSP), the largest denomination in the country, amidst high inflation.
The local currency continues to depreciate against foreign currencies, but Bank of South Sudan governor, Dier Tong Ngor, said the new banknote "will partially restore the dollar value of SSP".
He said that the new banknote will not increase inflation, but it will reduce the cost of printing lower denominations.
The introduction of the new banknote is in line with international best practices ensuring that demand for banknotes is aligned with economic activities.
The country has banknotes for denominations of 5 pounds, 10 pounds, 20 pounds, 100 pounds and 500 pounds.

Feb 10, 2021

Virescent Floats First Solar InvIT, Places 400 Mw Assets under Pvt Trust

KKR backed Virescent Infrastructure has floated the first infrastructure investment trust (InvIT) in the green power space. It will be a private Invit for which they have sought the approval for the Securities Exchange of India.
It is in the process of acquiring a portfolio of operational solar assets of close to 76 MWp at different locations including Patan (Gujarat), Jodhpur (Rajasthan) and Mohaba (Uttar Pradesh). The power purchase agreements (PPAs) for these assets are with state-owned counterparties. These assets would be vested in the InvIT.
The InvIT aims to achieve approximately 1.5 GW of assets in the next two to three years.

HDFC Bank Invites Applications from Entrepreneurs for SmartUp Grants

Private sector lender HDFC Bank is inviting applications from start-ups and individual entrepreneurs for its SmartUp grants.
This year, the bank will focus on start-ups creating social impact at scale in sectors such as education – technology (ed-tech) and skill development, among others.
SmartUp grants are a part of the bank's umbrella CSR brand, and are aimed at finding and deploying long-term, sustainable solutions at scale, to address social issues, and contribute to the economic and social development of the country.

Airtel, Jio, Vodafone Idea Queue up to Participate in 4G Spectrum Auction

Putting speculations to rest, all three private telecom operators – Airtel, Vodafone Idea and Jio – submitted their applications for participation in the upcoming auction of airwaves by the Department of Telecommunications (DoT). It is learnt that the three companies waited till the last day to submit their application. This development paves the way for an assured tripartite contest, in the auction, for buying the spectrum.
In the past, all the three telcos had expressed their reservation in purchasing the spectrum or participating in the auctions, over financial issues.
However, the reservation was more on the high price of 5G spectrum, which hasn't made the cut in the upcoming tender. According to Bharti Airtel Chief Executive Gopal Vittal, the 5G ecosystem is yet to develop here and the prices are very high and the company can't afford it.

India and Afghanistan Ink Deal for New Dam

Indian Prime Minister Narendra Modi called for an immediate and comprehensive ceasefire in Afghanistan to end a spike in violence, as the two countries signed an agreement for building a dam to supply water to Kabul city.
The project is a sign of India's continuing commitment to Afghanistan against the backdrop of the troubled peace process with the Taliban and a sustained wave of violence targeting officials, civil society activists and journalists in cities across the war-torn country. The agreement was signed on a day when eight people were killed in four targeted attacks in Kabul.

Feb 09, 2021

HDFC Life's New Term Plan

HDFC Life has launched its latest flagship term product 'Click 2 Protect Life'. The non-linked, non-participating, individual term plan has been designed to cater to the changing needs in the different life stages of an individual.
The 3D's in the plan stand offers protection against - Death, Disability and Disease.

Tesla Buys $1.5 Billion in Bitcoin, will accept crypto as payment soon

Holders of Bitcoin may be able to cash in some of their investment in the digital currency for a brand new electric car.
Electric automaker Tesla invested around USD 1.5 billion in Bitcoin, and it plans to begin accepting the digital currency as payment for its high-end vehicles soon.
The price of Bitcoin soared 15.4 per cent to around USD 44,500 in reaction to Tesla's announcement.
The California-based electric carmaker headed by Elon Musk revealed the new strategy in a filing with the US Securities and Exchange Commission, and said that its investment in digital currency and other alternative reserve assets may grow.
Bitcoin has drawn enthusiasts for its scarcity and security, but the volatile digital currency still is not widely used to pay for goods and services.

RBI to Conduct OMO of Rs. 20,000 Crore

The Reserve Bank of India (RBI) announced that it will purchase four government securities (G-Secs) that amount to Rs. 20,000 crore. The central bank will purchase it on February 10, 2021 under the open market operations (OMOs).
This move was announced in the aftermath of the yields that was moving up to touch the intra-day high of 6.1634 per cent recently. The RBI was concerned about the higher government borrowing.
After the announcement of the OMO purchase was made, yield on the benchmark 10-year G-Sec slowed down by 3-4 basis points. It now carries a coupon rate of 5.77 per cent as opposed to its previous closing yield of 6.1283 per cent.
Open Market Operations are the purchase and sale of the Government securities (G-Secs) by RBI from and to the market. The Open Market Operations are conducted with the objective of adjusting the rupee liquidity conditions in the economy.

Paytm's Vijay Shekhar, Innov8 CEO Invest in Startup Supersourcing

IT outsourcing platform Supersourcing has raised Rs. 1.5 crore from investors including Paytm founder Vijay Shekhar Sharma and co-working space provider Innov8 CEO Ritesh Malik.
Nikhil Sharma was also part of the seed-funding round.
The eight-month-old Indore-based company provides a platform to help companies find IT agencies to work with.

Siemens Ties up with IISc, CMTI to Set up Digital Transformation Labs

Siemens signed pacts with Indian Institute of Science (IISc) and Central Manufacturing Technology Institute (CMTI) to set up digital transformation labs.
Siemens signed two separate memorandums of understanding (MoUs) with IISc and CMTI, respectively, to establish first-of-its-kind digital transformation labs.
The labs are aimed at enhancing the expertise of researchers at IISc as well as technical skills of professionals in the machine tool industry, it said, adding that the MoUs will focus on development of industrial Internet of Things and Industry 4.0-enabled products and technologies.
This initiative will benefit many research scholars, students and industry professionals across the machine tool industry in Bengaluru for a period of three years.

PE Firm Advent International Acquires Stake in ZCL Chemicals

Private equity firm Advent International has signed a definitive agreement to acquire a majority stake in ZCL Chemicals (ZCL), one of the fastest-growing pharmaceutical firms in India. The business was formerly known as Zandu Chemicals.
Advent picked up a 51 per cent stake in the entity, which has an enterprise value of Rs. 1,700 crore. With this, Morgan Stanley Private Equity Asia (MSPEA), a private equity platform that previously managed a minority investment in ZCL, will exit the company.
ZCL was advised by Jefferies (Sole Financial Advisor), Bombay Law Chambers (Legal Counsel), and Deloitte (Finance and Tax).
ZCL is one of the fastest-growing manufacturers of speciality active pharmaceutical ingredients (APIs) and advanced intermediates.

Feb 08, 2021

India and Bahrain Join Hands for Renewable Energy

India and Bahrain have agreed to forge deeper engagement in the field of renewable energy. The Joint Working Group in the field of Renewable Energy which held its first meeting in virtual format underscored the importance of renewable energy to meet climate change goals.
The two sides presented the initiatives taken, progress made and future targets set by their governments. They also discussed opportunities available in the sector. They agreed to share experiences, expertise and best practices in the field of renewable energy. Furthermore, they decided to have greater engagement in capacity building and focused cooperation.
A Memorandum of Understanding was signed in July 2018 between India and Bahrain for promoting bilateral cooperation in the field of Renewable Energy.

Federal Bank Launches 'FedFirst' Savings Account Scheme for Children

Federal Bank has announced the launch of FedFirst, a special savings account scheme for children below 18 years of age. The account helps children develop healthy saving and spending habits, thereby giving them the freedom to save, spend and earn.
The account is designed to enable children to learn the importance of money management. The account comes with unique features and offers.
The account holder is provided with a FedFirst contactless Debit Card with a daily cash withdrawal limit of Rs. 2,500 and POS/e-com limit of Rs. 10,000, in addition to free online facilities including access to internet banking, mobile alerts and e-mail alerts.

Major Port Trusts, AAI Out of the Scope of PSE Strategic Divestment Policy

Certain classes of public sector entities, such as major port trusts, the Airport Authority of India, those undertaking security printing and minting, will not fall within the purview of the new PSE policy for strategic disinvestment.
The new Public Sector Enterprise (PSE) policy for Aatmanirbhar Bharat, which classifies public sector commercial enterprises as strategic and non-strategic sector, would be limited to central public sector enterprises, public sector banks and public sector insurance companies.
"The policy, however, does not apply to certain classes of public sector entities such as not-for-profit companies or CPSEs providing support to vulnerable groups or having developmental/promotional roles," said the scope of the PSE policy announced in the Budget.

Feb 07, 2021

Sri Lanka Settles $400 Million Currency Swap Facility with India

Sri Lanka has settled a USD 400 million currency swap facility with India.
The Reserve Bank of India (RBI) and the Central Bank of Sri Lanka (CBSL) had concluded the USD 400 million currency swap agreement in July last year under the SAARC currency swap framework.
This swap facility was drawn by CBSL on July 31, 2020 for an initial period of three months. A three-month rollover was provided at CBSL's request till February 1, 2021.
Further extension would require Sri Lanka having a successfully negotiated staff level agreement for an IMF (International Monetary Fund) programme, which Sri Lanka does not have at present. The CBSL settled the swap facility with the RBI as scheduled.

RBI Eases Rules for FPI Investments in Defaulted Bonds

In order to further boost foreign portfolio investments in the corporate bond segment, the RBI has proposed to exempt FPI investment in defaulted corporate bonds from the short-term limit and the minimum residual maturity requirement under the Medium Term Framework.
Detailed guidelines are being issued separately. At present, foreign portfolio investors can invest in security receipts and debt instruments issued by Asset Reconstruction Companies and debt instruments issued by an entity under the Corporate Insolvency Resolution Process, as per the resolution plan approved by the National Company Law Tribunal under the Insolvency and Bankruptcy Code, 2016, and these investments are exempted from the short-term limit and minimum residual maturity requirement under the Medium Term Framework for investment by FPIs in corporate bonds.

RBI to Set Up a 24x7 Helpline for Digital Payment Services

The Governor of Reserve Bank of India, Shaktikanta Das, announced that the central bank will set up a 24*7 helpline platform in order to strengthen the digital payment services in India. This announcement was made through the Statement on Development and Regulatory policy.
RBI has come up with many safety and security features apart from the measures to redress the grievances of the users in the past as well.
This announcement will further enhance the digital payments experience of users in India.
The RBI released the Payment Systems Vision document.
The document highlights the need of setting up a 24×7 helpline in order to address the customer queries with respect to the digital payment products.
The helpline will help in building the trust and confidence among the users. It will also help in reducing the expenditure on both financial and human resources that are incurred while addressing the queries and grievances.

ICICI Lombard First Private Insurance Company to set up IFSC Insurance Office in GIFT City

ICICI Lombard General Insurance, private sector non-life insurance company has received approval from 'International Financial Services Centre' (IFSC) Authority to set up an IFSC Insurance Office (IIO) in GIFT City at Gandhinagar in Gujarat.
IIO will enable ICICI Lombard to harness new opportunities in direct insurance and reinsurance areas. It will allow the company to offer offshore direct insurance solutions especially to Indian corporates and individuals present in overseas locations.
One of the key advantages of setting up an IIO in GIFT City for ICICI Lombard is the opportunity to expand its international business to service our clients located in foreign locations.

Aditya Birla Capital Posts Highest ever Consolidated Net at Rs. 289 crore

Aditya Birla Capital Ltd (ABCL) posted a 15 per cent jump in consolidated net profit to Rs. 289 crore for the quarter ended December 2020, the highest ever consolidated quarterly profit.
Company's net profit was at Rs. 250 crore in the same quarter of the previous fiscal.
Consolidated revenue for Q3FY21 grew 16 per cent to Rs. 5,346 crore as against Rs. 4,612 crore in the December quarter of FY20.
The robust quarterly performance was driven by strong growth across businesses.
ABCL, which is the holding company of the financial services of Aditya Birla Group, has subsidiaries across insurance, investment and non-banking financing activities among others.

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