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Economy

September - 2014

Panel set up to conduct forensic audit of NSEL

•  On a plea made by investors, the Bombay High Court, formed a committee headed by a retired high court judge to conduct a forensic audit of the troubled NSEL and liquidate the assets of its defaulting borrowers in the over Rs.5,500 crore payments scam.

•  The three-member committee, headed by Justice (Retd) V. C. Daga, will also have a solicitor and a chartered accountant, according to Advocate AmeetNaik, who represents NSEL in the case.

•  The committee will ascertain the liability that is outstanding against the defaulting borrowers of NSEL, conduct a forensic audit, and monetise the assets, the court said in its order.

•  The committee will determine where the amount has gone, and is empowered to ascertain the assets of company.

•  It has also been empowered to distribute the assets to the duped investors but distribution of funds will require the court’s permission.

World Bank rider for pedestrian project

•  The World Bank has told the Chennai Corporation that its funding of the pedestrian plaza at T. Nagar is conditional. It has advised the civic body to complete a study on environment and the social impact of the proposed pedestrianisation project in that area.

•  The study by the Chennai Corporation is also expected to assess the impact of the project on ‘reducing extreme poverty’ and ‘promoting shared prosperity’.

•  The Rs.83-crore pedestrian plaza, part of the T. Nagar redevelopment proposal, had already been approved by the Corporation Council a few months ago.

•  “Funding for the project will not be approved without a proper study of the social and environmental aspects of such an innovative urban infrastructure project,” said officials.

•  Work on commissioning the plaza with a commercial theme was expected to begin this month. But the requirement of a new study is likely to delay the project, they said.

•  The plaza is likely to become operational by May next.

•  The levels of pollution caused by traffic diversions, the increased number of visitors to T. Nagar, the rise in garbage collection and heightened commercial activity will also be assessed. Displacement of hawkers and impact on their livelihood will be part of the study.

Promotional air fares from IndiGo

•  Budget carrier IndiGo started promotional air fares by offering discounted one-way fares starting at a low of Rs.999 (all inclusive one-way fare), a day after SpiceJet started its offer of Rs.499 one-way charge.

•  According to IndiGo, its Delhi-Jaipur flight is priced at Rs.999 one-way, followed by Rs.1,399 Srinagar-Chandigarh.

•  The fares go all the way up to Rs.4,829 for Bangalore-Delhi. The fares are applicable for booking in 90 days in advance. — IANS

China to lay 1,300 km of rail tracks in Tibet by 202

• The extended railway lines built by China in Tibet — 251 km from Lhasa to Shigatse on the west and 433 km to Nyingchi (still under construction) in the east — will effectively link Tibet to India, Nepal and Bhutan

•  These are part of the Chinese government’s mission 2020 for infrastructure in Tibet.

•  The lines are also seen as a “triangular defence” for China, allowing it to rush troops and military hardware to its sensitive southern borders with India at short notice.

United Bank of India declares Vijay Mallyawilful defaulter

•  United Bank of India (UBI) has declared Vijay Mallya and three directors of Kingfisher Airlines (KFA) as wilful defaulters. The development was confirmed by the bank’s executive director Deepak Narang.

•  Besides Mr. Mallya, three other directors — A.K. Ganguly, SubhashGupte and Ravi Nedungadi — have also been declared as wilful defaulters, Mr. Narang .

•  The bank has an exposure of between Rs.350 crore and Rs.400 crore to KFA, which was given by the Bangalore branch of UBI.

•  It may be mentioned that UBI filed a caveat in the Supreme Court against KFA on August 29, 2014, after the Division Bench of the High Court dismissed a KFA appeal against UBI.

•  Earlier, UBI had identified Mr. Mallya as a wilful defaulter, and asked him to appear before the bank’s panel to hear him out before declaring him as a wilful defaulter.

•  Mr. Mallya later moved the court seeking exemption of his appearance before the panel.

Flipkart invests in ngpay

•  e-commerce firm Flipkart has made a strategic investment in mobile payments firm ngpay. Terms of the deal are not disclosed.

•  ngpay was founded in 2008 by Sourabh Jain. Meanwhile, Flipkart also said it would phase out its own payment product Payzippy launched last year.

Basel III capital norms revised

•  The Reserve Bank of India (RBI) issued revised and final guidelines for raising non-equity regulatory capital instruments by banks under the stringent Basel III framework under which lenders can issue Tier-2 capital with a minimum original maturity of five years as against 10 years now.

•  It further said banks could issue Tier-2 debt capital instruments to retail investors, subject to board approval.

Social media helps raise funds for Mumbai Film Festival

•  A fund-raising campaign on social media helped the Mumbai Academy of Moving Image (MAMI), the festival organisers, overcome a crippling financial crisis after their contract with Reliance Entertainment, the sole sponsor for the past five years, expired in February. “Since then, we were searching for the new sponsor. But we were unsuccessful,” said festival director Srinivasan Narayan.

•  The social media campaign helped the organisers raise Rs 1.5 crore in just two days. They are now expecting Rs. 5 crore by October.

•  The uncertainty over the festival’s future triggered a social media campaign, #pledge4MAMI from well-wishers.

• “As the word spread, the entire film fraternity came forward and now the industry itself is taking care of the festival. We are getting commitments from many individuals and we have also opened our website of the contributions from ordinary fans,” Mr. Narayan said.

TCS opens Saudi Arabia’s first all-women BPO centre

India’s largest software exporter Tata Consultancy Services (TCS) on Sunday said it has opened Saudi Arabia’s first all-female business process centre, which will provide employment to up to 3,000 women in three years. Saudi Aramco and GE are the centre’s first customers, TCS said in a statement in Mumbai. Both the clients have already surpassed their target of recruiting 100 women each, while the total number of those employed at the centre stands at 300, it said.

The Riyadh-based 3,200-sq mt facility will offer customers specialised finance and accounting, human resources, materials supply and office services to improve their operational efficiency, it said. Global auto makers seek friendly policy As India moves towards becoming a hub for production and exports for global car manufacturers, the latter said India needed to make more business-friendly policies if the country wanted foreign companies to invest here. Chairman of Japan Automobile Manufacturers Association (JAMA) Fumihiko Ike, who is also the Chairman of Japan’s Honda Motor Co, added another major challenge was to improve the business environment for investing into India.

 Protection to auto industry cannot be forever: Commerce Secretary In a veiled warning to the domestic auto sector, the Commerce Ministry, said it could not continue providing protection to the industry while duty barriers were coming down all over the world. India is protecting the domestic auto industry from overseas competition while signing free trade agreements with different nations and groups. New VP for Renault India Renault India Pvt. Ltd., a fully-owned subsidiary of Renault s.a.s, has appointed Rafael Treguer as Vice-President (Sales and Marketing).  He has worked in varied roles at different locations with the Renault group. — Special Correspondent Upper age limit set for MDs and CEOs of private banks The upper age limit for managing directors (MDs) and chief executive officers (CEOs) and other whole-time director of banks in the private sector has been fixed at 70 years.

 “Beyond this age (70 years), nobody should continue in the post,’’ the Reserve Bank of India (RBI) said. “Within the overall limit of 70 years, individual bank boards are free to prescribe a lower retirement age for the whole-time directors, including the managing directors and chief executive officers, as an internal policy,’’ the RBI said. Bajaj Auto launches two supersport KTM bikes Bajaj Auto, launched two supersport motorcycles from the KTM stable — KTM RC390 and KTM RC 200.  KTM bikes have won more than 240 World Championship titles. According to a company statement, the KTM RC390 is priced at Rs.2.05 lakh while the KTM RC 200 is priced at Rs. 1.60 lakh (both ex-showroom Delhi). Both bikes will be backed by KTM’s 140 exclusive dealer network across the country and will be available from September 10 with dealers.

 Micromax launches Canvas Nitro Micromax , launched its latest handset Canvas Nitro powered by an octa-core processor, targeted mainly at young professionals and college students, priced at Rs.12,990. The dual-SIM device, launched exclusively through online marketplace Snapdeal, runs on Android KitKat operating system, and comes with 2GB RAM, 5-inch HD IPS display, leather finish back, 13MP rear and 5MP front camera, 8GB memory (expandable up to 32GB), and 2500 mAh battery. Microsoft unveils new look for MSN in India Aiming to offer a comprehensive and seamless experience to users to access content via its website and apps across screens (PCs as well as mobiles) and operating platforms, software giant Microsoft unveiled the new look of its MSN website in India.

 The preview in India had been made live for users starting Monday and Microsoft was inviting people to try out the new web experience, he said, adding they could also leave feedback on the site. State Bank launches new travel card State Bank of India (SBI) and MasterCard, announced the launch of Multi-Currency Foreign Travel Card through 100 selected branches of Mumbai, Delhi, Chennai and Bangalore circles. The card, which is available in retail and corporate variants, will help consumers pay in dollar, pound settling, euro and Singapore dollar initially and eventually be made available in all major currencies.

Lupin tied up with Merck Serono

•  Lupin has tied up with Merck Serono, the biopharmaceutical division of Merck, to support the expansion of Merck Serono’s general medicines portfolio in emerging markets.

•  A statement from Lupin said the tie-up would address the local needs for affordable, high-quality medicines. While no financial details of the tie-up were available, Lupin said it had an established working relationship with Merck and the agreement could add up to 20 new products to the current portfolio.

•  Lupin will receive an upfront and milestone based licensing fee. The first launches are expected in 2016.

Infosys global partnership with Huawei

•  Infosys announced a global partnership with Huawei to offer enterprise customers big data and communication solutions besides expansion of its existing engagement with Microsoft and Hitachi Data Systems.

•  Providing details, in separate press releases, Infosys said the IT solutions to be developed with Chinese multi-national ICT firm Huawei would be for enterprise customers looking to modernise operations with cloud infrastructure.
  
  • Both the companies will build reference architectures and standardised solutions for big data platforms on Huawei hardware infrastructure.

Mahindra and Mahindra (M&M) partnered Snapdeal

•  Ahead of the launch of its new generation Scorpio, Mahindra and Mahindra (M&M) has partnered online marketplace Snapdeal for booking the sport utility vehicle (SUV).

•  Scorpio has been Mahindra’s one of the highest selling SUVs and the homegrown auto giant is to launch the refreshed version on September 25.

•  According to the details made available to users, the new generation Scorpio will be available in six variants.

“Make In India” campaign

•  Prime Minister NarendraModi will launch the “Make In India” campaign , aimed at reviving the job-creating manufacturing sector — key to taking the economy on a sustainable high growth path

•  The drive, the Modi Government hopes, will do for investment sentiment what the “Incredible India” campaign has accomplished for tourism.

•  With his “Come, make in India” slogan in his Independence Day speech, Mr. Modi had invited global companies to set up manufacturing units in India to supply to the rest of the world.

•  For the launch, the Government is likely to invite the who’s who of the global corporate sector from the US, Japan, Korea, Sweden, Poland, Australia, China, Italy, Germany and France.

•  The campaign also includes invitations to the world’s top 3,000 companies to explore investment possibilities in India. Indian Embassies around the world are expected to join the campaign.

•  “The objective is to take manufacturing growth on a sustainable basis to 10 per cent over the long term,”.

•  The Department of Industrial Policy and Promotion has set up an eight-member expert panel to redress grievances and handle queries of global and domestic investors within 24 hours.
  Its role will be to provide information and solve investors problems.

Reserve Bank of India unlikely to cut policy rate

•  While the Reserve Bank of India (RBI) is likely to maintain its policy rate at current levels, the financial markets expect that the central bank would reduce the Statutory Liquidity Ratio (SLR) further.

•  In the last bi-monthly policy review on August 5, amidst uncertainty over the progress of the monsoon, the RBI had kept the short term indicative lending rate (repo) at the current level of 8 per cent and the Cash Reserve Ratio (CRR) unchanged at 4 per cent. However, SLR was reduced from 22.5 per cent to 22 per cent with effect from August 9. In the June bi-monthly policy also, the central bank had cut SLR by 50 basis points from 23 per cent to 22.5 per cent.

•  SLR is the portion of deposits banks are required to maintain in the form of gold or government securities, before providing credit to customers. CRR is the portion of total deposits of customers, which commercial banks have to hold as reserves either in cash or as deposits with the central bank and the repo rate is the rate at which the central bank lends money to banks.

•  In the last policy review, Dr. Rajan said that “The idea behind the SLR cut is that if government finances are improving and the government is on a fiscal consolidation mode, we can afford to liberate more access to government financing and make it possible for the private sector and public sector firms to get access to that financing.”

“FDI should be understood as ‘First Develop India’: PM

•  Prime Minister NarendraModi launched the ‘Make in India’ campaign at a high-profile event, which captains of industry from India and abroad immediately joined by committing multi-crore investments and projects in the presence of Mr. Modi.

•  Speaking on the occasion, Aditya Birla Group chief Kumar Mangalam Birla said his steel-to-software conglomerate already had its manufacturing base in India and now planned to leverage its global production facilities for bringing technology here.

•  The head of India’s largest private sector company, MukeshAmbani of Reliance Industries (RIL), called the launch of the campaign a historic day for Indian industry and said, “We are committing ourselves to the movement our beloved Prime Minister had given to 1 billion Indians on Independence Day… The uniqueness of his leadership is that he dreams and he does.”

•  Unveiling the campaign logo earlier, Mr. Modi said “FDI should be understood as ‘First Develop India’ along with ‘Foreign Direct Investment’” while encouraging investors not to just look at India as merely a market but also as an opportunity.

•  The Prime Minister also noted that India ranked low on the “ease of doing business” index and said he was sensitising government officials to the need for “effective” governance.

India support exchange information on black money

•  India will support the proposed international automatic exchange of tax and banking information that is expected to aid unearthing and retrieving black money stashed offshore.

•  Forty-six countries, including India, have agreed to set rolling by 2017 the automatic exchange of information on tax evaders.

•  At present, countries exchange information on the basis of requests and that too only on suspected tax evasion and other financial crimes.

•  The proposed global standard would facilitate a systematic and periodic transmission of bulk taxpayer information by the source country of income to the country of residence of the taxpayer.

•  The implementation of these standards by developing countries could also improve domestic tax compliance as substantial amount of data received from financial institutions by the tax administration could be used for domestic tax purposes also.

Government decided to give boost to inland waterways

•  The Union Government has decided to give a boost to inland waterways in a big way to reduce the cost of transportation as well as to curb pollution. This was stated by Union Minister of Road Transport & Highways, Shipping, Rural Development and Drinking Water & Sanitation NitinGadkari.

•  He said that the ministry had also been focusing on the ports sector. He said for road development the government was considering to use cement instead of bitumen to bring down construction cost.

•  The Minister also said private sector was shying away from public private partnership (PPP) projects primarily because of high interest rates and reluctance of banks to fund such projects.

MCX-SX is going to change name

•  The Securities Exchange Board of India (SEBI) has approved a new name for MCX Stock Exchange (MCX-SX) which will now be known as ‘Metropolitan Stock Exchange of India Ltd’, abbreviated as ‘mSXI’.

•  The exchange is in the process of making an application to Registrar of Companies (RoC) for registration of the new name,” MCX-SX said in a statement
   

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