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MORNING BANKING & FINANCIAL NEWS UPDATES

ISSUE: 249 2023 12 June 2023

RBI KEY RATES FOREX (RBI REF. ) EQUITY /COMM. MARKET

Repo Rate: 6.50% INR / 1 USD : 82.4251 Sensex: 62625.63 (-223.01)
SDF: 6.25% INR / 1 GBP : 103.5452 NIFTY: 18563.40 (-71.10)
MSF /Bank Rate: 6.75% INR / 1 EUR : 88.8455 Bnk NIFTY: 43989.00 (-6.30)
CRR: 4.50% INR /100 JPY: 59.1300 Gold: 59,840.00 (-51.00)
SLR: 18.00% Silver: 73,825.00 (+155.00)

Moody's sees India's GDP expanding 6-6.3 percent in

Q1, flags fiscal slippage risks: Moody's on Sunday said the
Indian economy is expected to clock a 6-6.3 per cent growth in June
quarter, and flagged risks of fiscal slippage arising from weaker-than-
expected government revenues in the current fiscal.Moody's growth
estimate is lower than the 8 per cent projection for the first quarter
made by the Reserve Bank last week. In an interview with PTI,
Moody's Investors Service Associate Managing Director Gene Fang
said India has a relatively high level of general government debt at
around 81.8 per cent of GDP for 2022-23, and low debt affordability.
(Moneycontrol)
Gujarat pips Tamil Nadu as the leader in wind energy
capacity: Gujarat has become the No.1 State in installed wind
power capacity, pushing the long-time leader Tamil Nadu to the
second spot. As of May 31, 2023, Gujarat’s total installed capacity of
wind power stood at 10,416 MW, while Tamil Nadu’s wind power
capacity was at 10,125 MW. Two years ago, Gujarat’s wind power
capacity was about 1,000 MW lower than Tamil Nadu. However, with
faster capacity addition, it has made rapid strides in recent months.
(Business Line)
Govt to help set up panchayat level weather stations for
crop insurance: The Centre will soon announce a plan under the
Pradhan Mantri Fasal Bima Yojana (PMFBY) to set up weather
stations, one each in every panchayat, with a five year buy back
guarantee of rainfall and temperature data to be generated from
those units. If the plan takes off, there will be 1.75 lakh weather
stations functional in next two years without any capital expenditure.
“States have agreed to provide land and other infra related services.
Both private sector and public sector, including India Meteorological
Department (IMD) are expected to set up the facilities with their own
costs. But, the Centre will spend about ₹300 crore annually to buy
data from all the weather stations across the country,” a source said.
(Business Line)
IBBI proposes mandatory audit of insolvency resolution
process costs: Insolvency regulator, IBBI, proposes to stipulate
mandatory audit of Insolvency Resolution Process Costs (IRPC) in
resolution cases where the assets of the corporate debtor (CD) is in
excess of ₹ 100 crore. This proposal forms part of the nine new
measures that the Insolvency and Bankruptcy Board of India (IBBI)
has mooted in a new discussion paper that has been floated to
increase the possibility of resolution, the value of the resolution plan,
and enable timely resolution. Public comments have been sought
electronically on this discussion paper latest by June 27.
(Business Line)
UAE emerges as fourth largest investor in India in FY23:
The United Arab Emirates (UAE), with which India implemented a
comprehensive free trade agreement in May last year, has emerged
as the fourth largest investor in India during 2022-23, according to
government data. In the last fiscal, foreign direct investment (FDI)
from the UAE to India jumped over three-fold to USD 3.35 billion from
USD 1.03 billion in 2021-22, the data of the Department for Promotion
of Industry and Internal Trade (DPIIT) showed. Singapore was the
largest investor in India with USD 17.2 billion investment in FY23,
followed by Mauritius (USD 6.1 billion) and the US (USD 6 billion).
(Economic Times)
Indian Oil top bidder for Reliance’s KG gas for 2nd
auction in a row: Indian Oil Corporation (IOC), the nation’s largest
oil firm, has walked away with half of the natural gas that Reliance
Industries Ltd and its partner bp of the UK offered in the latest auction
of the fuel used to generate power, produce fertilizer, turned into CNG
and used for cooking purposes. IOC got 2.5 million standard cubic
meters per day out of the 5 mmscmd of gas auctioned last month,
sources with knowledge of the matter said.
(Financial Express)
HDFC Bank to keep home loans as focus of growth
strategy post merger: India’s HDFC Bank Ltd will keep home
loans at the centre of its growth strategy after a merger with HDFC
Ltd is concluded, with such credit likely to make up nearly a third of
the bank’s portfolio going forward, two senior officials at the group
said. The pace of growth in home loans will broadly mirror growth
seen in HDFC’s home loan portfolio, the first official said, declining to
be identified as strategy discussions are not public.
(Financial Express)
Wilmington Trust moves insolvency plea against
SpiceJet; hearing on Monday: Wilmington Trust, one of
SpiceJet’s aircraft lessors, has moved the National Company Law
Tribunal (NCLT) to initiate an insolvency process against the airline
for non-payments of dues. The first hearing of this case will take place
on Monday.Wilmington Trust is an affiliate of Aircastle, which had last
month filed a similar case at the NCLT. During this case’s ongoing
hearings, SpiceJet said that Aircastle’s petition had defects and it
could not be maintained. Consequently, the NCLT on June 6 asked
Aircastle to submit its reply to SpiceJet’s rejoinder within two weeks.
(Business Standard)
BOI to raise up to Rs 3,000 cr via tier II bonds to support
business growth: Public sector lender Bank of India plans to raise
upto Rs 3,000 crore in capital through tier II bonds in the current
financial year to support business growth. The Mumbai-based lender
has board’s approval in place to raise up to Rs 6,500 crore in FY24,
of which Rs 4,500 crore would be through additional tier-I
bonds/equity and balance via tier II bonds. The tier II bond issuance
would be subject to market conditions, bond market sources said.
(Business Standard)
India tops world ranking in digital payments with 89.5
mn transactions: India with 89.5 million digital transactions in the
year 2022 has topped the list of five countries in digital payments,
according to data from MyGovIndia. As per the data, India in the year
2022 accounting for 46 per cent of the global real-time payments,
adding that the digital payment transactions in India is more than the
other four leading countries combined. Second, on the list is Brazil
which amounted to 29.2 million transactions followed by China with
17.6 million transactions. On number 4 is Thailand with 16.5 million
digital transactions followed by South Korea with 8 million worth of
transactions, the data from MyGovIndia has stated.
(Business Standard)
At 6.6%, Indian stock market delivered higher returns
than US, China in last 123 years: DSP Report: Over the last
123 years, the Indian stock market has delivered a real return of 6.6
per cent, which is higher than the returns delivered by US and China
markets as well as the world equity markets, according to the Netra
June 2023 report released by DSP Asset Managers titled ‘Early
Signals Through Charts’. This means that India has compounded
investors' wealth at 6.6 per cent CAGR or compound annual growth
rate, higher than 6.4 per cent CAGR by the United States and 3.3 per
cent by China since the year 1900. The CAGR shows real
compounding which means it is adjusted for inflation and takes care
of currency depreciation that happens over the years because of
inflation, according to DSP.
(Mint)
FY24 to be golden year for Punjab National Bank: MD
Atul Kumar Goel: The current financial year will be ‘golden year’
for public lender Punjab National Bank due to its multi-pronged
strategy and steady focus, its managing director Atul Kumar Goel has
said. The state-owned bank's aim for FY24 is to further scale up
operational efficiency for facilitating sustainable and profitable
growth.
(Mint)
 TODAY’S FINANCIAL TERMINOLOGY/CONCEPTS
SFURTI Scheme

❖ The government had launched the Scheme of Fund for Regeneration of

Traditional Industries (SFURTI) back in 2005 which was last revamped in
September 2022 to promote cluster development for MSMEs in traditional
industries.
❖ The scheme intends to bring together enterprises in the khadi industry,
village industry (such as cottage industry, medicinal plants Industry, bee-
keeping, agro based & food processing industry, polymer and chemical
based industry, fiber industry, textile industry, etc) and coir industry as
collectives or clusters and give required support for growth. Here’s how
the scheme benefits clusters and eventually artisans through multiple
levels of support.
❖ The scheme aims to benefit clusters through a focus on physical
infrastructure creation, technology upgradation, training, product
development, innovation, design interventions, marketability, improved
packaging and marketing infrastructure of the business with the aim to
improve artisanal income, according to the latest scheme guidelines.
❖ SFURTI enables assistance up to Rs 2.5 crore for the development of
‘regular’ clusters with 500 artisans or less and up to Rs 5 crore for the
development of ‘major’ clusters with more than 500 artisans.

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