General Awareness

BUSINESS AND ECONOMY - June 2020

Jun 2020

Jul 30, 2020

Sembcorp Commissions 3 Wind Projects of 800 MW

Minister for Power and New & Renewable Energy (MNRE) R. K. Singh inaugurated Sembcorp's state-of-the-art three wind power projects with a total capacity of 800 MW. Sembcorp Energy India Limited (SEIL), a wholly-owned subsidiary of Sembcorp Industries, announced the completion of its latest 800 MW wind power projects, bringing its renewable energy capacity in India to 1,730 MW. With the full commissioning of its three 300 MW wind projects, Sembcorp has become the first independent power producer to fully commission its projects awarded in the first three wind auctions held by Solar Energy Corporation of India (SECI). Together, these assets provide enough clean energy to power more than 6,00,000 homes and avoid over two million tonnes/annum of carbon dioxide emissions. This capacity is also the largest operational wind capacity with any developer to-date from SECI auctions.
Singh congratulated SEIL and the Singapore government for their work and commitment to the renewable energy sector. He said that we are determined to achieve energy transition for which we will ensure transparency, fairness and level playing field to our partners in the sector. He further added that we are committed to achieving the target of 175 GW Renewable Energy capacity by 2020 and Prime Minister Narendra Modi's vision of 450 GW Renewable Energy capacity by 2030.

Gujarat and UK India Business Council Sign MoU to Improve Industrial Development

The UK India Business Council signed a Memorandum of Understanding (MoU) with Industrial Extension Bureau (iNDEXTb), Industries and Mines Department, Government of Gujarat, the premier agency focused on accelerating industrial development in the state.
This collaborative partnership between the UKIBC and the Government of Gujarat will help to boost business and industrial development in the state. It will also aim to proactively enhance the business environment and strengthen collaboration with British businesses in Gujarat.
The MoU was signed at a virtual roundtable by Neelam Rani, Managing Director, Industrial Extension Bureau (iNDEXTb), Government of Gujarat and Kevin McCole, Managing Director, UKIBC in the presence of Peter Cook, Deputy High Commissioner, British Deputy High Commission - Ahmedabad, M. K. Das, Principal Secretary (Industries and Mines Department), Government of Gujarat and Arti Kanwar, Resident Commissioner & Commissioner (Investment Promotion), Government of Gujarat.

PFC Ties Up with IIT-Kanpur for Research and Training in Smart Grid Technology

State-owned Power Finance Corporation (PFC) signed an agreement with the Indian Institute of Technology- Kanpur for training, research, and entrepreneurship development in smart grid technology.
As per the memorandum of association, the PFC will provide financial assistance of ₹2.38 crore to IIT-K under its CSR initiative.
The objective of the pact is to provide support to IIT-K in developing infrastructure for research and development on smart grid technology, R Murahari, Executive Director (CSR&SD), PFC, said.
As part of the project, the IIT-K will also provide training on smart grid technology to 90 participants and provide fellowship to nine selected candidates for development of ideas on smart grid technology.
The fellows will be assisted by startup Innovation and Incubation Centre (SIIC) of IIT-K and encouraged to take up entrepreneurial activities.

Jul 29, 2020

Punjab Second Largest Tractor Exporter

Punjab has pipped Tamil Nadu to become the second largest tractor exporter in FY20. Maharashtra retained the top position by exporting tractors worth $186 million.
Punjab has manufacturing units of Sonalika, Mahindra & Mahindra and Preet Tractors having installed capacity of over four lakh tractors per annum. Sonalika alone has a capacity to manufacture three lakh tractors per annum.
According to Directorate General of Commercial Intelligence and Statistics data, Punjab exported tractors worth $178 million in 2019-20 while Tamil Nadu exported tractors worth $156 million.
Punjab is the only state among the top five exporting states which witnessed a growth of 1.70% in exports last fiscal. All other states witnessed a negative growth. Overall, the tractor exports nosedived to $765.77 million in FY20 as compared to $973.94 million in 2018-19, witnessing a decline of 21.37%.
Volume wise, the country exported 76,226 tractors in FY20 as compared to 92,075 in 2018-19, a decline of 17%. Sonalika was the largest exporter with 18,078 units.

Reliance to Pay for Future Group Retail Chains

As per reports, Mukesh Ambani's Reliance Industries Ltd will pay between Rs. 24,000 crore and Rs. 27,000 crore ($3.2-$3.6 billion) to buy the Indian retail chains owned by Future Group.
Asia's richest man, Ambani has been buoyed by investments close to $20 billion from backers including Google and Facebook in his oil-to-telecoms conglomerate, and is seeking to strengthen his hand in India's huge retail sector.
Reliance's existing retail operation already runs close to 12,000 stores, including a cash-and-carry wholesale business, in over 6,700 Indian towns and cities.
Owned by India's "father of modern retailing", Kishore Biyani, Future Group is home to supermarket chain Big Bazaar, upmarket food stores Foodhall, and bargain clothing chain Brand Factory.

Sitharaman Attends 5th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank

Union Minister of Finance Nirmala Sitharaman attended the 5th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) through video conference.
Every year at the Annual Meeting, the Board of Governors meet to take key decisions that impact the Bank's future. The discussions at the meeting broadly covered official business including the election of the President of the AIIB and a roundtable discussion on the theme 'AIIB 2030-Supporting Asia's Development over the Next Decade'.
Sitharaman was identified as a Lead Speaker at the roundtable discussion. In her intervention, she appreciated AIIB's efforts for fast-tracking financial assistance of about $10 billion to its member countries including India to combat COVID-19 pandemic.
She mentioned about Prime Minister Narendra Modi's initiative of creating a COVID-19 Emergency Fund for SAARC Nations and India's efforts in supplying critical medical health kits to tackle the COVID-19, and now supporting global efforts of COVID-19 vaccine trials. Besides, the Finance Minister highlighted India's participation in the "G20 Debt Service Suspension Initiative".
Sitharaman also outlined various measures taken by the Government in response to the COVID-19, including the $23 billion Pradhan Mantri Garib Kalyan Yojana (PMGKP) and $295 billion Atma Nirbhar Bharat Package (ANBP), which aim at protecting all sectors and sections of the economy.

SBI Provides USD 16 Million Liquidity Support for Local Businesses in Maldives

According to the Indian High Commission in the Maldives, the State Bank of India (SBI) is providing liquidity support of USD 16.20 million for local businesses and deferred loan repayment for over 200 retail accounts.
On the occasion of Independence Day of the Maldives on July 26, Indian High Commissioner Sunjay Sudhir said that assistance of USD 400 million through an extended currency swap arrangement has been made available already to tide over liquidity shortage. India will soon announce another substantial financial assistance package to support the Maldivian economy and assist in economic recovery post-COVID-19.

ICICI Lombard in Talks to Acquire Bharti Axa General Insurance

As per reports, private sector lender ICICI Lombard is set to acquire Bharti Axa General Insurance in an all stocks deal worth between Rs. 2500 and Rs. 2800.
The proposed merger will require requisite approvals from Insurance Regulatory and Development Authority (IRDAI) to go through.
The full stock buyout would also likely see AXA, the French insurance and asset management company, which currently holds a 49 per cent stake in the insurance company, exit their India business.

Bharti AXA General Insurance Launches Crop Insurance Campaign, 'Bohot Zaroori Hai'

Bharti AXA General Insurance launched its crop insurance campaign,'Bohot Zaroori Hai' for farmers in Maharashtra and Karnataka to encourage them about their yield protection and financial security. It aims to create awareness to farming communities about the relevance and significance of crop insurance, which can alleviate rural distress caused by crop failure or damage due to unseasonal rains, monsoon failure among others.
Bharti AXA General Insurance had received Rs. 800 crore worth crop insurance mandate from the governments of Maharashtra and Karnataka to insure their farmers under the Pradhan Mantri Fasal Bima Yojana (PMFBY).
Bharti AXA General Insurance has secured authorization for a period of 3 years from both the state governments to implement the PMFBY in six districts of Maharashtra and three districts of Karnataka.
The PMFBY offers insurance cover to farmers against losses of crops during the entire cycle from preparation of sowing to harvesting and post-harvest, due to poor yield.
PMFBY is open for both lenders and non lenders. The scheme covers food crops (cereals, millets and pulses), oilseeds as well as horticultural crops.

Jul 28, 2020

BIS to Frame Quality Norms for 371 Items by March 2021 to Curb Non-essential Imports

To check imports of sub-standard and non-essential goods, including from China, the Bureau of Indian Standards (BIS) said that it is framing mandatory quality standards for 371 items identified by the commerce ministry and the process will be completed by March 2021. The list of 371 tariff lines includes several segments, ranging from steel, chemicals, pharmaceuticals and electrical machinery to furniture and toys.
As per BIS Director General Pramod Kumar Tiwari, the commerce ministry has identified 371 imported tariff lines, including Chinese products. We are trying to frame standards and make them mandatory and improve enforcement of the same.
The concerned ministries are identifying the important products from the list given by the commerce ministry and approaching BIS for making the standards mandatory.
Asked for how many products from the list the standards have been made so far, Tiwari said that it is a complex issue. Different ministries like steel, chemicals and petroleum have been told to identify the products for making standards.
For some products, ministries have decided not to have standards because of insignificant import volumes, while for certain items, there are already standards in place.

Danish Company Maj Invest Buys 18% Equity in SAVE Solutions for Rs. 120 crore

Danish company Maj Invest bought 18% equity in SAVE Solutions, an Indian financial inclusion company, for Rs. 120 crore, reflecting investor confidence in the sector's potential even amid Covid-19.
SAVE Solutions is a business correspondent for State Bank of India, Bank of India and Bank of Baroda and intends to use this capital to expand its direct lending through subsidiaries SAVE Microfinance and SAVE Financial Services.
SAVE, which started its journey from Gaya in 2009, may use part of the funds to strengthen IT infrastructure.
Unitus Capital advised SAVE Solutions on the deal while Khaitan & Co advised the overseas firm.
Maj Invest manages $12 billion in assets, of which about $1 billion are in private equity commitments. Its financial inclusion funds invest directly in micro lenders across Asia, Latin America and Africa.

Guidelines for Schemes to Boost Domestic Manufacturing of Bulk Drugs and Medical Devices

The government released guidelines for four schemes to boost domestic manufacturing of bulk drugs and medical devices as part of its drive to reduce dependency on imports for these critical products.
In line with the vision of Prime Minister Narendra Modi, the schemes have been conceptualised for making India 'atmanirbhar (self-reliant) in the pharma sector.
The schemes—a production-linked incentive (PLI) scheme and industry park scheme each for bulk drugs and medical devices—seek to make India self-reliant in pharmaceuticals raw materials such as drug intermediates, active pharmaceutical ingredients (APIs) and key starting materials (KSMs), and medical devices.
Currently the country almost entirely depends on imports—mostly from China—for production/supply of 53 critical bulk drugs, while 86% of medical devices, too, are imported.
Bulk drug parks "will be based on plug and play model with prior regulatory approvals, state of art infrastructure, excellent connectivity, affordable land, competitive utility charges, and strong R&D ecosystem and so on.

Jul 27, 2020

India Hikes Exposure to US Government Securities by Nearly USD 13 Billion in May

According to latest official data, India's holdings of American government securities increased by nearly USD 13 billion to USD 169.9 billion at the end of May. So far this year, the country's exposure has seen significant fluctuations and had touched a record high of USD 177.5 billion in February.
After marginally rising to USD 157.4 billion in April, the holdings jumped to USD 169.9 billion in May, an increase of around USD 13 billion in a month's time.
India's holdings stood at USD 164.3 billion in January. The American government securities are purchased by the Reserve Bank of India (RBI).
The country was the 12th largest holder of the American government securities while Japan had the maximum exposure at USD 1.260 trillion at the end of May. At the second spot was China with holdings worth USD 1.083 trillion, followed by the United Kingdom at the third place with an exposure of USD 393.5 billion.
As per the data, Ireland is at the fourth position, followed by Brazil, Luxembourg, Hong Kong, Switzerland, Cayman Islands, Belgium and Taiwan.

Tamil Nadu Signs 16 MoUs for Investments Worth Rs. 5,137 crore

In a bid to bring increased investments into the state, the Tamil Nadu government signed 16 memoranda of understanding (MoUs) worth Rs. 5,137 crore aimed at creating employment opportunities for over 6,555 people. The fresh bunch of MoUs come close on the heels of the state inking 8 MoUs with companies involving investment of about Rs. 10,339 crore and promising employment opportunities for 13,507 people.
Among the major investments, Adani Enterprises, the flagship company of the Adani Group, signed an MoU worth Rs. 2,300 crore for setting up a data centre while Princeton Digital Group inked a deal for Rs. 750 crore. Super Auto Forge, manufacturer of cold and warm forged steel and aluminium parts and BPL-FTA Enterprises, have given an investment commitment of Rs. 500 crore each. The Super Auto investment will be for steel and aluminium parts manufacturing.

Gross NPA of Banks May Rise to 12.5% by March 2021: RBI FSR

According to the 21st issue of Financial Stability Report (FSR), released in July 2020 by Reserve Bank of India (RBI), the gross nonperforming assets (GNPA) ratio of all scheduled commercial banks (SCBs) may increase from 8.5% in March 2020 to 12.5% by March 2021 under the baseline scenario; the ratio may escalate to 14.7% under a very severely stressed scenario.
While Public sector banks' (PSBs) gross bad loans ratio of 11.3% at the end of March, 2020 may increase to 15.2% by March 2021 under the baseline scenario, on the other hand, private banks may see an increase from 4.2% to 7.3%.
FSR reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on risks to financial stability, and issues relating to development and regulation of the financial sector.

Aditya Puri Sells Shares worth Rs. 843 crore in HDFC Bank

Aditya Puri, managing director and chief executive officer of the country's largest private sector lender HDFC Bank sold 95% of his stake valued at Rs. 843 crore in the bank this week. As per reports, Aditya Puri sold 74.2 lakh shares of the bank between July 21 and Jul 24. Before this transaction, Puri held 77.96 lakh shares or 0.14% of banks equity capital.
Puri who took home Rs 18.92 crore salary including perquisites but excluding stock options in the financial year 2019-20 sold shares worth Rs 200 crore in HDB Financial Services, the unlisted NBFC arm of the private lender in December last year. These shares were held through a family trust Vistra ITCL (India). In 2013, he transferred his shares to his family as part of the succession planning. The family's shareholding was transferred to the Trust, Vistra ITCL.
The term of Aditya Puri who has been the managing director and chief executive since 1994 when the bank was set up ends on October 20, 2020. HDFC Bank board in November last year (2019) set up a search committee to identify his successor. Aditya Puri will act as an advisor to the 6-member group comprising Shyamala Gopinath, Sanjiv Sachar, M. D. Ranganath, Sandeep Parekh, Srikanth Nadhamuni and Keki Mistry.

Jul 26, 2020

TRIFED Signs MoU with IIT Delhi under Govt's 'Unnat Bharat Abhiyan'

The Tribal Cooperative Marketing Development Federation of India (TRIFED) entered into a partnership with IIT Delhi under the HRD Ministry's flagship 'Unnat Bharat Abhiyan' (UBA) to boost livelihood opportunities and income generation for tribal communities.
The UBA connects higher education institutions with villages for the economic and social betterment of rural communities.
TRIFED functions under the Tribal Affairs Ministry.
Under TRIFED's 'Van Dhan' programme, tribal entrepreneurs will now be able to get access to the expertise of the entire network of more than 2,600 academic and research institutions under the UBA.
With the partnership with IIT Delhi and 'Unnat Bharat Abhiyan', these tribal forest dwellers engaged in MFPs will get exposure to newer processing technologies, product innovation, mentorship, transformational digital systems and hand holding.

RBI Signs $400 mn Currency Swap with Sri Lanka

The Reserve Bank of India signed necessary documents for extending $ 400 million currency swap facility to the Central Bank of Sri Lanka. This currency swap arrangement, which will remain available till November 2022 will help Colombo address the economic hardships caused due by pandemic.
Based on the request from the Sri Lankan side for a currency swap facility under the SAARC Currency Swap Framework, India extended a $ 400 million currency swap under the SAARC framework.
The signing of the currency swap agreement with Sri Lanka illustrates India's commitment to assist its friendly neighbour on its economic revival during the time of Covid-19 pandemic.

India-UK Hold 14th Joint Economic and Trade Committee Meeting

India and the U.K. have affirmed their commitment to negotiate a free trade agreement (FTA) with a view to further strengthening economic ties.
The issue was discussed in the 14th Joint Economic and Trade Committee (JETCO) meeting between the two countries. It was co-chaired by Commerce and Industry Minister Piyush Goyal and U.K. Secretary of State for International Trade Elizabeth Truss.

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