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Business Current Events Archive

Government chooses Inflation Hawk Urjit Patel as RBI Governor to Continue Rajan's Legacy

RBI's incumbent Deputy Governor, 52 year old Urjit Patel, has been chosen by Modi government as the new RBI governor. Patel will assume office on September 4, after the incumbent RBI governor Raghuram Rajan steps down. Urjit Patel, who is known as the “inflation warrior” of Rajan, has promised to give his best shot “to live up to the expectation of people”. Union Finance Minister Arun Jaitley congratulated Patel and wished him success. Reports say, it was under Patel-led committee’s recommendation that the inflation target range for India has been set between 2 to 6 per cent.

SEBI Chairman admits complex Challenges in Commodity market regulation

UK Sinha, Chairman of Securities and Exchange Board of India (SEBI), in the “chairman’s statement” of 2015-16’s annual report of SEBI said that the security watchdog confronts “many complex challenges” in commodity market regulation. SEBI is currently trying to bring the derivatives market of the commodities at par in all respects with that of the securities market. Sinha said in the statement that the organisation is “endeavouring towards reshaping and refining” market regulations of commodities derivatives to strengthen the risk management framework and boost exchanges’ surveillance mechanisms.

FM Jaitley calls for Municipal Level Reforms for Ease of Doing Business

Union Finance Minister Arun Jaitley, while addressing an audience at a seminar (on the topic “State economic reforms: The way ahead”) in Bhilai said that all round effort on part of the central and state government has started to ease doing business in India. However, he stressed upon the need of percolating down the efforts to civil bodies (municipal and panchayat levels). Jaitley said that passage of GST bill in the parliament is a major step towards taxation reforms, which will help Indian economy to become more competitive in the global market.

British Secretary says GST will make India more Attractive to Foreign Investment

U.K. Secretary of State for International Development Priti Patel, currently on a 3-day visit to India, has revealed that passage of the GST (Goods and Services Tax) has helped India become a more attractive destination for foreign investors because of the ease of business. She called it an important reform and said that her government is already assisting India in the development of smart cities that includes Amravati, Indoor, and Pune.  She also met PM Modi and discussed on strategic relationship between India and UK.

SBI Net Profit drops by 32 Per Cent, Stocks Rise by over 7 Per Cent

State bank of India’s net profit dropped by 32 per cent (from Rs. 3,692 crore last year to Rs. 2,521 crore) mainly due to rising Non Performing Assets (NPAs) or bad loans. Reports say, gross NPA of SBI crossed the one lakh crore mark (Rs 1,01,541 crore) from the preceding quarter. SBI chairman Arundhati Bhattacharya has said that the rate of credit creation growth in financial year 2017 will be 12 per cent and the NPA creation growth will taper off. However, SBI stocks rallied and increased by 7.1 per cent, owing to less than expected growth in bad loans.

July Merchandise exports fall despite June industrial growth at 8-month High

Industrial growth in the month of June jumped to a 8-month high to 2.1 per cent, a significant increase over its may result of 1.1 per cent. Data released by Central Statistics Office (CSO) shows that the increased growth was posted due to robust production in mining and electricity verticals. During June, Index of Industrial production’s major component – manufacturing - increased by 0.9 per cent, which is higher than May’s figure of 0.6 per cent. However, slowing global economy has yet again led to contracted merchandise exports – by 6.8 per cent in June.

Bank of England's Stimulus Plan makes Indian Stock Market Rally

After Bank of England (BoE) announced stimulus plan along with cutting borrowing cost for protecting Britain’s economy after Brexit fallout, Indian bourses witnessed strong rally with sharp foreign investment inflows. Yesterday benchmark BSE Sensex increased by 363.98 points (1.3 per cent) to close above 28,000 (28,078.35) points. National Stock Exchange’s Nifty 50 also witnessed a strong rally as it closed at 8,683.15 points, jumping by 1.5 per cent or 132 points. Highest gainer was Hero MotoCorp, witnessing gain of 5 per cent.

PM Modi meets Cabinet Ministers on GST Bill

In an effort to firm up strategy for passing the long awaited Goods and Services Tax (GST) Bill, Prime Minister Narendra Modi met Union Finance Minister Arun Jaitley, Union Home Minister Rajnath Singh, and BJP chief Amit Shah late last night at his residence. Jaitley, while speaking to the press, said that they are keeping their fingers crossed. Reports say 30 out of the 32 parties are in favour of the bill. GST bill will be taken up in parliament for consideration and passage next week, likely on Tuesday.

Vedanta-Cairn India Merger Deal Sweetened to appease Minority Shareholders

Boards of Vedanta and Cairn India met yesterday to revise final terms for their merger deal to make it more attractive for the minority stakeholders, who termed the earlier deal unfair. The merger terms have been sweetened by promising each minority stakeholders of Cairn India 1 equity share along with 4 redeemable preference shares (having face value of Rs 10) in Vedanta. The preference shares can be redeemed after 18 months with an option of redeeming them within 30 days of allotment.

Gadkari offers Tesla Land near major Indian ports to Make in India

Transport Minister Nitin Gadkari has wooed US-based electric car major Tesla to set up its Asia manufacturing hub in India by offering land near major Indian ports so that they can export manufactured cars easily to South and South East Asian countries. With a view to introduce pollution-free road transport in India, Road Transport and Highways Minister Gadkari offered to promote joint ventures between Tesla and Indian automobile companies. Senior Tesla executive said that the Indian government’s offer will be considered at an appropriate time.

Jet Airways to Charge Money for Extra Cabin Bags

Jet Airways is going to charge Rupees Nine Hundred on every extra cabin bag carried by the passengers. Every passenger will be allowed to carry 10 kgs of cabin bag, depending on the type, whether the ticket is of business class or economy. This is going to be implemented from Friday.

United Spirit accuses Liquor Baron Mallya for Rs. 1,225 Crore Diversion

Liquor Baron Vijay Mallya’s erstwhile group firm United Spirits Limited (USL) has accused in a filing to BSE that Mallya diverted funds (of Rs. 913.5 crore) and carried out improper transactions (of Rs. 311.8 crore) with entities (including Kingfisher Airlines and Formula One team) associated with him. Per USL, the gross violations came to light during an additional prima facie inquiry between October 2010 and July 2014. While hearing a plea of Enforcement Directorate, a Delhi court asked Mallya to appear before it on September 9.

US introduces H-1B and L-1 Visa Reform Act, Likely to Affect Indian IT Companies if Passed

Democratic Congressman Bill Pascrell from New Jersey and Republican Dana Rohrabacher from California have introduced H-1B and L-1 Visa Reform Act of 2016 in the House of Representatives. If the legislation is passed by the Senate, it may adversely affect revenue model of major big IT companies from India. The bill proposes to prohibit companies (employing more than 50 employees) from hiring H-1B employees if over 50 per cent of their employees are holders of H-1B and L-1 visas.

UK Business Secretary Sajid Javid talks to Sitharaman on Possible UK-India FTA Post-Brexit

Just a fortnight after people of UK voted in favour of Britain’s exit from the European Union, UK Business Secretary Sajid Javid started dialogue with India’s Commerce & Industry Minister Nirmala Sitharaman to explore the possibility of inking a separate Free Trade Agreement (FTA) between India and UK. When asked about the issue, Sitharaman said that the informal talks will transform into a formal framework but didn’t divulge whether the agreement will be FTA or a preferential one.

Morgan Stanley's Ruchir Sharma believes India's GDP Overstated, Needs more Private Investment

Ruchir Sharma, Chief Global Strategist of Morgan Stanley, has called GDP number of India “overstated” and emphasised on the need of increasing private investment so that Indian economy gets back on track. He emphasised on the linkage between low sustainable inflation rate with very high investment level and gave examples of emerging economies including China, Korea, and Taiwan. He appreciated RBI’s decision of keeping inflation within 5 per cent. Though Sharma was fine with overall investment in India, he reminded that most of the investments are government supported.

Tax Department unearths Rs. 43,000 Crore Undisclosed Income in Last 2 Years

Union Revenue Secretary Hasmukh Adhia has said that undisclosed income to the tune of Rs. 43,000 crore has been unearthed by Income Tax Department in the last two fiscal years. Though he didn’t disclose whether the money unearthed belonged to corporate entities or individuals, Adhia categorically mentioned that Rs. 21,000 crore has been unearthed from the searches done by the department and the rest Rs. 22,000 crore “from various surveys”.  He also said that his department is working on the tax amount to be levied on this undisclosed income.

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.