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India to seek $3 Billion Infra Funds from Asian Infrastructure Investment Bank

Union Finance Minister Arun Jaitley, during his third day of China visit, addressed board of governor’s session of Asian Infrastructure Investment Bank’s annual general meeting and urged them to set up an office in New Delhi. He also asked the China-backed bank to finance infrastructural investments in India to the tune of US$ 2 to 3 Billion. The infrastructural projects to be involved here would include urban development, railways, energy, water supply, inland waterways, and urban transport.

Tata Group's Bloodbath and Fear of Job Loss among Indian Diaspora looms large after Brexit

With UK embracing Brexit, Indian multinational Tata Group (salt-to-software conglomerate having 19 operating companies in UK employing 60,000 people) witnessed jittery investors dumping its stocks, leading to an aggregate market capitalisation loss of around Rs. 30,000 crore in a single trading day. Indian diaspora is also apprehensive of job loss. India’s travel companies, however, believe that free fall of British Pound after Brexit will help surge total number of Indian leisure travellers to Britain. RBI Governor Raghuram Rajan said fundamentals of Indian economy including low short-term external debt and sizeable foreign exchange reserves will help India cushion itself from Brexit ripples. Economic Affairs Secretary Shaktikanta Das assured India will not have long-term impact of Brexit because of strong domestic fundamentals.

India can Bear Brexit Effects, Says Finance Minister Arun Jaitley

Arun Jaitley, the Finance Minister of India has mentioned that Britain's decision of leaving the European Union will not affect Indian economy as the country is prepared for it. Though India's Sensex dropped by 3.4% to 26, 022.60 points after the Brexit results came, but Mr. Jaitley said that the market fundamentals of the country are strong enough to take care of this volatility.

Raghuram Rajan's Exit Makes Banks, Markets Edgy

Market regulator SEBI and stock exchanges are bracing themselves for possible shocks that may arise following RBI governor Raghuram Rajan’s decision to step down and not return for a second term on September 4. The onus is now on Securities and Exchange Board of India and stock exchanges to keep an equilibrium and protect capital markets from any excessive volatility on Monday.

RBI Guv Raghuram Rajan not to go for Second Term, Leaves Market Dumbstruck

In a sudden and surprise move, incumbent RBI Governor Raghuram Rajan told RBI colleagues and employees in a communication that he’s not going to serve a second term and will return to academia after his tenure ends on September 4, 2016. In his 888-word email Dr. Rajan said that he took the decision after watching the ongoing developments, due reflection, and consultation with government. Finance Minster Arun Jaitley appreciated Rajan’s efforts and said that a decision on appointing the 24th RBI governor will be done soon. While Infosys founder NR Narayana Murthy called Rajan’s exit as “very sad”, Noble Laureate Amartya Sen said India lost the most skillful economic thinkers of the world.

SEBI approves relaxed norms for Real Estate Investment Trusts and Foreign Fund Managers

SEBI (Securities and Exchange Board of India) board has cleared proposals of floating consultation papers on amending rules that govern activities of Real Estate Investment Trusts (REITs) and foreign fund managers for making domestic capital markets more attractive. One of the proposed relaxations is allowing REITs of investing larger portion of funds in under-construction assets. Reports say two separate draft papers on the matter will be placed in public domain soon for seeking response of stakeholders.

ED attaches Rs. 1411 Crore Property of Vijay Mallya on Loan Default Case

To recover Rs. 950 crore loan default case of liquor baron and owner of now defunct Kingfisher Airlines Vijay Mallya, Enforcement Directorate (ED) has attached his properties worth over Rs. 1411 crore. The move comes after a day ED moved to Mumbai court for declaring the business tycoon a proclaimed offender. Properties attached include Coorg’s 27 acre coffee plantation, Bangalore’s UB Towers, and others in Chennai and Mumbai. Banks are now trying to recover around Rs. 9000 crore loaned to Mallya for his collapsed venture Kingfisher Airlines.

Manufacturing Sector drags Down Industrial IIP by -0.8 Per Cent

After improving IIP (Index of Industrial Production) for two consecutive months (February and March 2016), the same witnessed a sluggish growth (-0.8 in April 2016) in April 2016 mainly due to contracting manufacturing sector (witnessing a contraction of 3.1 per cent in April 2016 over same period last year). Industrial output growth decelerated in 2015-16 fiscal (2.4 per cent) in comparison to 2.8 per cent during 2014-15. However, in April 2016, growth posted by industry groups in manufacturing increased from 12 (in March 2016) to 14 (in April 2016).

India becomes world's third largest oil consumer

India has beat Japan in oil consumption and now ranks next only to US and China, according to a BP Statistical Review of World Energy release. While India's oil demand is 4.1 million barrels per day, leading consumer US' demand is 19.39 million bpd and China 11.96 million bpd). India's share in world's total oil consumption is 4.5 per cent.

Status quo in RBI policy rates

RBI Governor Raghuram Rajan announced that key policy rates will be kept unchanged in view of rising inflationary pressure. Rajan said that a rate cut could be possible later in 2016 if a good monsoon helps in easing inflation. The RBI chief urged banks to pass on the benefits of previous rate cuts. He stressed on the importance of a better transmission of policy easing as it is critical to support growth.

SEBI Chairman says Sensex giving Annualised return of 15.5 Per Cent

Security watchdog SEBI’s (Security and Exchange Board of India) Chairman UK Sinha has told a renowned media channel in San Francisco that Indian market is ahead of others because of better corporate earning as well as heady mix of policy measures. While stressing on over 7.5 per cent growth forecast of Indian economy, Sinha said that the Indian portfolio market is giving large returns in the long run (with compound annualised growth rate of 15.5 per cent over the years).

RBI Shows Way to Ease Bad Loans of Banks

With public sector banks reeling under bad loans, Reserve Bank of India has written a letter to the Indian Banks’ Association (dated 31 May) proposing that lending banks may set up two different funds so that bad debt issue can be resolved at the earliest. While one fund can infuse working capital to companies, the other can infuse equity into stressed companies. Reports say that gross non-performing assets of listed companies have reached a staggering Rs. 5.91 lakh crore by March 2016.

India to Discuss sale of BrahMos Supersonic Cruise Missiles to Vietnam

Defence Minister Manohar Parrikar  is all set to visit Vietnam from 5 -6 June (after attending Shangri-La Dialogue in Singapore) to discuss export of BrahMos Supersonic Cruise Missiles (290-km range) that was jointly manufactured by India and Russia. BrahMos missile flies at the speed of Mach 2.8 (thrice the speed of sound). The move comes just before the 10 June Malabar exercise, off Okinawa, even as China (trying to increase its presence in the contentious South China Sea) is already prickly on the issue.

Reliance Industries closes down few Dahej Plant Units

Reliance Industries Ltd. has shut down few units of its Dahej petrochemical plant in Gujarat due to water shortage. The lower release of dam water and the increasing level of salinity of water supply to RIL’s Dahej manufacturing complex has led to shortage of good quality water at the Dahej complex. RIL has temporarily shut down its PTA and PET plants. 

Sales of Khadi Units increase by 14 Per Cent as India Inc Complains

In a stark contrast with India Inc’s complaint of having weak rural sales in rural India due to poor rains, khadi and village industries are registering double-digit growth (14 per cent sales growth registered during 2015-16 reaching Rs. 37, 935 crore). Most of the 7 lakh privately-owned household units, funded through PM's Employment Generation Programme, have spiked sales in the last 2 years mainly through aggressive distribution push including bulk order from institutional buyers such as Indian Railways and Air India.

PM Modi says RBI Rajan's reappointment not Issue of Media's Interest

With current Reserve Bank of India’s Governor Raghuram Rajan’s term coming to an end this September and newly elected Rajya Sabha BJP MP Subramanian Swamy beating up the rhetoric of sacking Rajan immediately, Prime Minister Narendra Modi broke his silence in a question to Wall Street Journal. PM Modi said that reappointment of Rajan as RBI Governor is purely an administrative issue (finalised after consultation between Finance Ministry and Prime Minister) and went on to say that it shouldn’t “be an issue of interest to the media”.

RBI Governor Rajan pitches for Better Start-up Business Environment

Reserve Bank Governor Raghuram Rajan has pitched for providing better business environment for start-ups. He categorically mentioned that India has surely done away with the “license raj” but, to some extent, is continuing “inspector raj”. He stressed on self-certification by start-ups with some checks on part of authorities for preventing misuse. Rajan also gave examples of UK where liberal regulations have led to higher start-up growth than in Italy. While speaking at 4th Odisha Knowledge Hub, RBI Chief said that Indian economy is recovering.

Jaitley praises eCommerce companies for benefitting customers

While delivering speech at annual lecture of Competition Commission of India (CCI), Union Finance Minister Arun Jaitley lauded eCommerce companies for bringing widest possible choices before consumers at most competitive prices. Jaitley went on to add that E-commerce “promotes innovation, efficiency and quality”. He said that his government is making every possible effort for improving India’s “ease of doing business index”. Minister went on to say that passage of Insolvency and Bankruptcy Code is going to help sick industrial companies resolve problems quicker.

HSBC India to shut down 24 branches in 15 cities

HSBC India, part of London-based banking gianst HSBC, has planned to shut down 24 branches in 15 different cities in India. The intention behind this step is to reflect the changes in the customer behaviour, who are frequently using various digital channels for undertaking banking transactions. The bank network would be consolidating from 50 branches across 29 cities to 26 branches across 14 cities.

Sensex & Nifty open lower during early trade

Both BSE Sensex and Nifty have opened lower with Sun TV shares shrinking by 10%. As per analysts, a rate hike in the US would actually make it less attractive for the foreign investors to put capital in India’s emerging markets. Also, the Federal Reserve Officials believe increasing interest rates in June is actually appropriate if the economic data points to the stronger second-quarter growth.