General Awareness

BUSINESS AND ECONOMY - August 2020

Aug 2020

Jan 27, 2021

China Overtakes Germany to Run World's Largest Current Account Surplus

China overtook Germany to become the country with the world's largest current account surplus in the year 2020, as per a survey by the Munich-based Ifo institute.
The current account surplus of China more than doubled to $310 billion in 2020, while the current account surplus of Germany shrank for the fifth year in a row in 2020 to $261 billion.
The data underlines a tectonic shift in world trade triggered by the coronavirus crisis as higher demand across the globe for medical protection gear and electronic devices boosted Chinese exports.
The United States remained the country with the world's largest current account deficit which rose roughly by a third to $635 billion in 2020 or 3.1% of economic output.
Japan ranked third with a current account surplus of $158 billion. Ifo (Information and Forschung) Institute for Economic Research is a research institution based in Munich, Germany, which analyses economic policy.

Ministry of Road Transport to Impose "Green Tax"

The Ministry of road transport has decided to impose the additional taxes on old vehicles that are no more fit on the road. This additional tax is being called as the "Green Tax". The decision was taken to curb pollution. It will also motivate people to switch to environment-friendly alternatives to the vehicles.
The Green tax will reduce the pollution level. It will also make the polluter to pay for creating pollution.
Revenue collected from the green tax will be kept in a separate account. The amount will be used for tackling the problem of pollution.
The states have been asked to set up state-of-art facilities to monitor the emission.
Green tax is also called as the pollution tax or environmental tax. The tax is an excise duty on goods that results into the environmental pollutants. An economic theory says, that if taxes will be charged on emissions causing pollution will lower the environmental impairment in a cost-effective manner. The tax will encourage the behavioural changes in households and firms that are required to reduce the pollution. The tax mainly aims to ensure that polluters are duly punished for their pollution creating activities.

Jan 26, 2021

Tata Power Solar Wins Order to Set up 320 MW Project

Tata Power Solar Systems Ltd (Tata Power Solar), a wholly-owned subsidiary of Tata Power, announced that it has received an order worth Rs. 1,200 crore from state-run power giant NTPC.
The company has received a Letter of Award (LoA) to build 320MW of ground mounted Solar PV project for NTPC.
The commercial operation date for the project is set for May 2022.
The order pipeline of Tata Power Solar now stands at approximately 4GWp valued at approximately Rs. 12,000 crore with this latest addition.

Future-RIL Deal Gets SEBI Nod

Future Retail's Rs. 24,713-crore deal to sell its retail assets to Reliance Industries (RIL) has got approvals from stock exchanges with certain riders.
The indebted group will have to seek shareholders' nod for the deal and get an approval from the National Company Law Tribunal (NCLT).
Markets regulator SEBI has also given a go-ahead to Future Group's scheme of arrangement and sale of assets to Reliance Industries Ltd (RIL).

Okinawa Autotech Plans to Invest Rs. 150 crore to Set up New Manufacturing unit in Rajasthan

Electric two-wheeler maker Okinawa Autotech plans to invest Rs. 150 crore in setting up a new manufacturing unit in Rajasthan, and roll out fresh products as it sets a target of selling 1 lakh units in the next fiscal year, according to a top company official.
The company, which had launched B2B electric two-wheeler - Okinawa Dual, priced at Rs. 58,998, targeting the delivery sector, expects sales from the segment to account for around 20 per cent of its total sales.
The new manufacturing unit will be near the company's existing plant in Rajasthan.
Okinawa Autotech launched its Okinawa Dual, powered by a 250 Watt electric motor with 48W 55Ah detachable lithium-ion battery with a range of 130 km on a single charge. It has a top speed of 25 kmph.

SBI, ICICI Bank and HDFC Bank Remain as D-SIBs

The RBI state-owned SBI, along with private-sector lenders ICICI Bank and HDFC Bank continue to be Domestic Systemically Important Banks (D-SIBs) or institutions which are 'too big to fail'. SBI, ICICI Bank, and HDFC Bank continue to be identified as Domestic Systemically Important Banks (D-SIBs), under the same bucketing structure as in the 2018 list of D-SIBs.
SIBs are subjected to higher levels of supervision to prevent disruption in financial services in the event of any failure.
The Reserve Bank had issued the framework for dealing with D-SIBs in July 2014.
The D-SIB framework requires the central to disclose the names of banks designated as D-SIBs starting from 2015 and place these lenders in appropriate buckets depending upon their Systemic Importance Scores (SISs).
SIBs are seen as 'too big to fail (TBTF)', creating the expectation of government support for them in times of financial distress. These banks also enjoy certain advantages in funding markets.

Reliance Industries Spins Off Oil-to-Chemical Business into New Unit

Billionaire Mukesh Ambani's Reliance Industries Ltd has completed spin-off of the firm's oil-to-chemical business into a new unit that will help it pursue growth opportunities with strategic partnerships.
The oil-to-chemical (O2C) business unit holds Reliance's oil refinery and petrochemical assets and retail fuel business but not upstream oil and gas producing fields such as KG-D6 and textiles business.
Reliance for the first time reported integrated earnings of the O2C business in its third quarter financial results. Previously, refining and petrochemical businesses were reported separately while fuel retailing revenue was part of the firm's overall retail business.
In the October-December 2020 earnings statement, refining and petrochemical as well as fuel retailing businesses earnings were reported as one. As a result, it did not give refining margins - the most sought after number to assess the firm's oil refining business.

RBI Slaps Penalty on Standard Chartered Bank

The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs. 2 crore on Standard Chartered Bank–India for delays in reporting of frauds. The penalty has been imposed on the bank for non-compliance with certain directions issued by it contained in the 'Reserve Bank of India (Frauds — Classification and Reporting by commercial banks and select FIs) Directions 2016'.
The notice was issued to the bank advising it to show cause as to why a penalty should not be imposed on it for such non-compliance with the directions. After considering the bank's reply to the notice and oral submissions made in the personal hearing, the RBI concluded that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty.

Jan 25, 2021

Axis Bank Launches Aura Credit Card

Axis Bank unveiled a credit 'AURA' exclusively loaded with several health and wellness benefits for its users at an affordable price. Axis Bank has partnered with Poshvine to offer benefits and specialists such as Decathlon, Practo, Fitternity, IndushealthPlus, 1MG etc. to offer a complete and unique health & wellness solution to the cardholders.
Cardholders will get a discount on annual medical checkup through IndushealthPlus.
It offers up to 4 free online video consultations for a month, with round the clock access to doctors on all 21 specialities. This is offered by Procto.
It also offers 4 free online interactive fitness sessions for a month by Fitternity.
Through this card, the users can have access to 16 recorded training sessions for one month and can choose from a wide range of sessions such as yoga and cross-functional training programs, etc.

Cairn Energy's Shareholders Ask India to Honour Arbitration Award

An arbitration tribunal unanimously overturned a Rs. 10,247 crore retrospective tax demand on the British oil and gas company and asked the government to return value of the shares it sold, dividend it seized and tax refunds it stopped to enforce the tax.
Some Cairn Energy Plc.'s marquee shareholders that include BlackRock, MFS, Franklin Templeton and Fidelity, have asked the Indian government to honour the retrospective tax assessment arbitration award and return $1.2 billion to the British oil firm.
Cairn, which on this day seven years back was first slapped with a retrospective tax assessment, is three-fourth owned by world's top investors with $529 billion MFS Investment Management of U.S. being its largest investor with 14.02% stake.
New York-based BlackRock is the second biggest shareholder with 12.19% stake. Other investors include Fidelity International, Franklin Templeton, Vanguard Group and Aberdeen Standard Investments, according to stock exchange data.

China Takes New Foreign Investment Top Spot from US

China has overtaken the US as the world's top destination for new foreign direct investment.
New investments into America from overseas companies fell by almost half last year, leading to the loss of its number one status.
In contrast, UN figures show direct investment into Chinese firms climbed 4%, putting it number one globally.
The top ranking shows China's growing influence on the world economic stage.
China had $163bn (£119bn) in inflows last year, compared to $134bn attracted by the US, the United Nations Conference on Trade and Development (UNCTAD) said in its report
In 2019, the US received $251bn in new foreign direct investment while China received $140bn.
While China may be number one for new foreign investment, the US still dominates when it comes to total foreign investments.
This reflects the decades it has spent as the most attractive location for foreign businesses looking to expand overseas.

Jan 24, 2021

RBI Imposes Penalty on Standard Chartered Bank

The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs. 2 crore on Standard Chartered Bank–India for delays in reporting of frauds.
The central bank said that the penalty has been imposed on the bank for non-compliance with certain directions issued by it contained in the 'Reserve Bank of India (Frauds — Classification and Reporting by commercial banks and select FIs) Directions 2016'.
The penalty has been imposed in exercise of powers vested in the RBI under the provisions of the Banking Regulation Act 1949, for delays in reporting of frauds to RBI, revealed during the statutory inspection of the bank with reference to its financial position as on March 31, 2018, and March 31, 2019.

Morgan Stanley Fund Invests $25 mn in LEAP India

Morgan Stanley India Infrastructure has made an investment of Rs. 180 crore (US$ 25 Million) to acquire a stake in LEAP.
Founded by Mr. Sunu Mathew in 2013, LEAP is India's largest pallet pooling company with an asset pool of approx. 4 million units including pallets, foldable large containers (FLC), crates and utility boxes.
This is the single largest round of investment raised by LEAP. Now with Morgan Stanley India Infrastructure as a partner, LEAP aims to achieve a total asset pool of 6 million and provide technologically advanced products to the market.
LEAP's business is linked to India's consumption story and primarily caters to fast moving consumer goods (FMCG), consumer durables, beverages, e-commerce, retail, auto and auto- component manufacturing sectors.

Reliance General Insurance Launches Hospi Care Health Policy

Reliance General Insurance, a 100% subsidiary of Reliance Capital, has launched Hospi Care policy, a hospitalization cash benefit product that provides lump sum payout for 150+ listed surgeries and 140+ daycare procedures occurring due to an illness or an accident. This policy is designed specifically to provide seamless cash flow for healthcare needs to our retail customers.
The policy provides surgical procedure cash, hospital daily cash, day care treatment cash, other surgeries cash and covers hospitalizations due to dengue/malaria/chikungunya. Customers can choose this product to safeguard themselves against the increasing incidences of medical expenses. Reliance Hospi Care enables policyholders to claim up to 100% of sum insured in lump sum depending on the surgical procedure, allowing them access to quality and timely healthcare.
For instance, if the insured is covered under a Rs. 10 lakh policy, in case of a heart or lung transplant surgery 100% of the sum-insured is payable, also the policy has a special feature where the insured could receive coverage for surgeries that are over and above the listed ones and benefit with a lump sum cash of up to Rs. 20,000.

Jan 23, 2021

NSE is World's Largest Derivatives Exchange for 2nd Consecutive Year

The National Stock Exchange of India Ltd (NSE) remained the world's largest derivatives exchange for the second consecutive year in 2020 in terms of number of contracts traded, according to the Futures Industry Association (FIA).
In addition, the bourse has been ranked fourth in the world in cash equities by number of trades by the World Federation of Exchanges (WFE) for calendar year 2020.
The exchange said it has been focused on building robust markets for all asset classes and had launched a host of new products and services last year.
In the capital market segment, NSE has listed T-bills (Treasury Bills) and SDLs (State Development Loans) facilitating investors to transact in these securities, in addition to the existing dated Government Securities (G-sec) available for trading.

Airtel Payments Bank Launches 'Safe Pay' to Curb Online Frauds

Airtel Payments Bank launched 'Airtel Safe Pay', a mode of safe digital transactions to protect its customers from online payment frauds.
Airtel Payments Bank said that with 'Airtel Safe Pay', Airtel customers making UPI or net banking-based payments through Airtel Payments Bank, no longer have to worry about money leaving their accounts without their explicit consent.
Airtel Safe Pay leverages Airtel's telecom exclusive strength of network intelligence to provide an additional layer of payment validation compared to the industry norm of two-factor authentication.

SEBI Penalises HDFC Bank in BRH Wealth Kreators Case

The Securities Exchange Board of India (SEBI) has imposed a fine of Rs.1 crore for invoking securities pledged by BRH Wealth Kreators in violation of the regulator's interim orders.
The markets' regulator in an order issued said that the bank had extended loan facility to BRH and BRH commodities to the tune of Rs. 87.75 crore against shares, however, it invoked securities pledged to the extent of Rs. 158.68 crore without giving any notice to the clients.
According to the regulator, the invocation of pledge of client securities was not in conformity with the directions contained in the interim order which was issued on 7 October 2019. SEBI has therefore asked HDFC Bank to deposit an equivalent amount of ₹158.68 crore along with interest from 14 October 2019 till date, at the rate of 7% per annum in a separate interest bearing escrow account, till the issue of settlement of clients' securities is reconciled.

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