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ARTH (11TH APRIL-20TH APRIL)- Economic Affairs

1.India's response to pandemic swifter than US, Germany, South Korea- UK study

As per a study taken up by the Oxford University, India moved swifter than many

developed countries in unveiling measures to deal with Covid-19 outbreak within its

borders.

Keypoints-

• As per data available on Oxford Covid-19 Government Response Tracker

(OxCGRT), New Delhi fared better than the United States, Germany, Italy, Spain,

South Korea and Britain.

• The Stringency Index of the OxCGRT measures how the governments reacted to

the pandemic as it spread around the globe.

• The data for the same is collected and updated in real-time by Oxford University.

• Data is collected based on 11 indicators ,

1. government’s efficiency in closing down schools

2. cancelling public events

3. closing public transport

4. aunching public information campaign

5. curbs on internal travel and international travel

6. fiscal measures

7. monetary measures

8. investment in healthcare

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9. investment in vaccines

10. testing policy

11. contact tracing.

• The Reserve Bank of India and the Finance Ministry took steps to support the

poor and the salaried class. The government also released a Rs 15,000 crore

special Covid-19 package to arm states to deal with the virus.

• According to Oxford tracker India has been a relatively better performer on the

various indices an indication that the response was swift in dealing with the

pandemic while other countries were slow to adopt measures.

• The index only measures the governments' response to the crisis and not how

effectively they implemented the policies.

2. RBI circular on loan moratorium challenged in Supreme Court

The public interest litigation (PIL) was filed in the Supreme Court against the

Reserve Bank of India’s March 27 circular on the three-month moratorium

permitted for loan repayments due to the economic impact of the COVID-19

pandemic. The Reserve Bank of India, on March 27, had permitted all lending

institutions to allow a three-month moratorium on repayments of all kinds of

installments, including for credit cards, for all term loans outstanding between

March 1, 2020 and May 31, 2020.A similar three-month deferment for all working

capital loans to help borrowers tide over the coronavirus related economic

hardships was also permitted.

Keypoints-

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• It seeks the Supreme Court’s directions to ensure that customers are not

charged accrued interest for the moratorium period.

• The catch in this relief was that interest would continue to accrue during the

three-month moratorium, which would additionally have to be borne by a

customer if he/she chose to avail of the benefit.

• The PIL points out that during such difficult times, the state must not look to

enrich itself, and has also sought SC directions to both the RBI and the

government to consider even extending the moratorium period for loan

repayment for longer.

3.Karnataka Bank gets RBI nod to reappoint Mahabaleshwara M S as MD and CEO for 3 yrs

Private sector lender Karnataka Bank said it has received RBI nod for reappointment of

Mahabaleshwara M S as MD and CEO for next three years. The regulator has also

approved for reappointment of P Jayarama Bhat as part time (non executive) chairman.

Karnataka Bank

HQ- Mangalore

Tagline- Your Family Bank Across India

4. Fiscal deficit at 5.07% of GDP in February, likely to increase in March

According to a report released by government, India’s fiscal deficit stood at 5.07% of

gross domestic product (GDP) in February.This could make it difficult for the

government to meet its revised fiscal deficit target of 3.8% of GDP for FY20.

Keypoints-

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• As per data from the Controller General of Accounts (CGA), India’s fiscal deficit

touched Rs 10.36 lakh crore at the end of February.

• Amid the brunt of the Covid-19 impact and the lockdown, government revenues

are likely to take a substantial hit in March of GDP for FY20.

• With regard to states, who are at the forefront of the battle against the virus

spread, the report showed a sharp fall in their aggregate treasury holdings by

nearly Rs 32,000 crore in March to Rs 1.87 lakh crore.

• As per the report, the states received about Rs 90,000 crore as tax devolution for

March and around Rs 29,000 crore for various schemes in FY20.

• The Centre also released an additional Rs 1.44 lakh crore to the states for the

same period, according to the recommendations of the 14th FC.

Source- ET

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5.TRIFED in Collaboration with UNICEF & WHO organized a Webinar for

Promotion of Digital Campaign for SHGs

TRIFED organized a Webinar for Virtual training to its Trainers and Self Help Groups

(SHGs) on basic orientation on Covid-19 response and key preventive measures to

ensure tribal gatherers carry on their work safely. It was aimed to reach more than

18,000 participants and would cover tribal regions across all the 27 States. To ensure

tribal gatherers carry on their work safely, TRIFED has collaborated with UNICEF and

WHO for developing a digital communication strategy for promoting a digital campaign

for Self Help Groups (SHGs) involved in this work, highlighting the importance of Social

Distancing.

Keypoints-

• The target of this Digital Campaign is to reach up to 50 lakh tribal gatherers to

ensure their safety.

• UNICEF is providing the necessary support to the SHG Centers in the form of

Digital Multimedia content.

• To start with, 15,000 of these SHGs will be promoted as Van Dhan Social

Distancing Awareness cum Livelihood Centers’ through a digital training

program.

6. Government of India sanctions Rs. 15000 crores for India COVID-19 Emergency

Response and Health System Preparedness Package

Government of India (GoI) has announced significant investments to the tune of

Rs.15000 crores for 'India COVID-19 Emergency Response and Health System

Preparedness Package'. The funds sanctioned will be utilized for immediate COVID-19

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Emergency Response (amount of Rs.7774 crores) and rest for medium-term support (1-

4 years) to be provided under mission mode approach.

7. Bengaluru’s Jana Small Finance Bank launches digital banking platform

Jana Small Finance Bank, a scheduled commercial bank, has launched DIGIGEN - a

digital banking platform where customers can digitally open a Savings Account and

Fixed Deposit instantly.

DIGIGEN onboarding is a hassle-free, three-step process to open an account. DIGIGEN

also offers a host of other exciting features, including online bill payment, instant money

transfer and airport lounge access on debit card, to name a few.

8.Forex reserves up nearly $2 billion to $476.5 billion: RBI

The Reserve Bank said the country’s foreign exchange reserves have risen by nearly

USD 2 billion to USD 476.5 billion as of April 10. The reserves, which are being pointed

out as one of the biggest assets in the fight against challenges posed by the COVID-19

pandemic, had stood at USD 474.66 billion.

Keypoints-

• RBI said net foreign direct investment was USD 2.9 billion as compared to USD

1.9 billion in the year ago period.

• Similarly, the net foreign portfolio investment in equities was also higher at USD

0.4 billion in the April 1-9 period as against an inflow of USD 0.2 billion in the

year-ago period.

• Portfolio debt investment recorded an outflow of USD 0.7 billion as against net

outflow of USD 0.9 billion a year ago.

• The 34.6 per cent contraction in exports has happened.

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• Merchandise imports also fell by 28.7 per cent in March across the board, barring

transport equipment.

9. Kotak Bank to raise ₹8,000 cr via promoter stake sale

Kotak Mahindra Bank (KMB) may raise Rs 8,000 crore via equity dilution,.This amount

would be raised through a 4% stake sale, given that the lender’s market capitalisation is

at Rs 2 lakh crore.

Sector experts say that the fund-raising is targeted mainly at dilution of the promoter’s

stake in order to comply with regulatory requirements. RBI had allowed KMB a six-

month timeline – up to August – to reduce promoter shareholding to 26%.

10. NIRDPR and UNICEF training community leaders online to combat COVID-19

More than 28.33 lakh community leaders are being trained through online programmes

to practise social behaviours required to control the transmission of COVID-19 cases in

villages. NIRDPRs Communication Resource Unit (CRU) and UNICEF are working

closely with the governments of Telangana, Andhra Pradesh and Karnataka in

preparedness and responses to contain the pandemic.

11. India's subsidies to renewables drops 35 per cent from FY17 to FY19: Report

A study by the International Institute for Sustainable Development (IISD) and the

Council on Energy, Environment and Water (CEEW) India's renewable

energy subsidies fell 35 per cent from 2017-18 to 2018-19, while its oil and gas

subsidies increased by 65 per cent,

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Keypoints-

• The study named Mapping India's Energy Subsidies 2020, emphasises that the

health and economic crisis caused by Covid-19 will influence subsidy

expenditure.

• The crash in world oil prices and the government's economic stimulus packages

will be key factors shaping the energy sector in the future.

• The authors of the report note that there were already signs that support for

renewable energy would increase again, but with the shocks from Covid-19, it is

now critical to stay on track.

• Although subsidies for electric cars have grown over 11 times since FY2017,

researchers note that continuing to raise ambition on clean transport will be

important to meet India's targets for 30 per cent of new vehicle sales to be

electric by 2030.

12. India is world's most digitally dexterous country: Survey

According to a survey by Gartner, Inc, sixty-seven per cent of digital workers in India

said emerging technologies such as machine learning (ML), artificial intelligence (AI),

Internet of Things (IoT) are increasing their effectiveness at work.

Keypoints-

• The Gartner 2019 Digital Workplace Survey found that India is the most digitally

dexterous country in the world.

• India is followed by the UK and the US, due to having the largest Gen Z

workforce along with the desire to learn new skills using digital technologies in

the workplace.

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• Twenty-seven per cent of the digital workers in India are skilled experts in digital

technology for work purposes, the research and advisory firm.

• Seven out of ten employees in India said that adoption of new digital

technologies will create career opportunities and higher paying jobs.

• Forty-five percent of digital workers in India do not mind having their work habits

tracked and monitored by digital technologies.

• The survey also showed that digital workers not only want formal training but are

also willing to undertake on-the-job (OTJ) and just-in-time (JIT) training to

enhance their digital skills at work.

• In India, 39 per cent of digital workers want to be trained OTJ to keep their

knowledge on AI, ML, IoT up to date.

13. RBI launches latest round of quarterly survey on manufacturing sector

The Reserve Bank of India launched latest 49th round of quarterly survey order books,

inventories and capacity utilisation survey (OBICUS) of manufacturing sector. The

survey provides valuable input for monetary policy formulation,

Keypoints-

• The reference period is January-March 2020.

• The RBI has been conducting the OBICUS of the manufacturing sector on a

quarterly basis since 2008.

• The information collected in the survey includes quantitative data on new orders

received during the reference quarter, backlog of orders, pending orders, total

inventories with a breakup between work-in-progress (WiP) and finished goods

(FG) inventories and item-wise production.

• As per the last survey, capacity utilisation (CU) had declined to 68.6 per cent in

the third quarter of 2019-20 from 69.1 per cent in the previous quarter.

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14. Tata AIA becomes first life insurance company to give additional benefits

related to Covid-19

Tata AIA Life Insurance announced additional benefits for its policyholders and agents

as the first insurance company to do this in India. As part of Tata AIA Life’s initiative, its

individual policyholders will get COVID-19 related additional benefit up to Rs 500,000 at

no additional cost. Further, to extend the Circle of Protection to its own Agents, all

‘active’ Agents of Tata AIA Life Insurance along with their spouse and children will be

reimbursed up to Rs 25,000 in case of hospitalisation due to COVID-19.

15. Hindalco closes $2.8 billion deal to acquire Aleris

The Aditya Birla group’s flagship company Hindalco completed the buyout of Aleris

Corp by its wholly owned subsidiary Novelis Inc at an enterprise value of $2.8 billion (Rs

21,295 crores). The deal marks Novelis’ potential entry into the high-end aerospace

segment.

16. India's GDP to contract by 6.1 per cent in April-June: Nomura

According to Nomura, the Indian economy will contract by 6.1 per cent in the April-June

quarter and is likely to expand only in the December quarter, expecting another 0.75 per

cent cut in rates by the RBI to push growth in 2020.

The economy will grow at 3.2 per cent in the January-March period and contract by 6.1

per cent (June quarter) and 0.5 per cent September quarter, before rising by 1.4 per

cent in the last quarter of the calendar year.

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17. Coronavirus fallout: India's GDP growth rate may fall to 1.1% in FY21, says

SBI Ecowrap

According to SBI Ecowrap, India's GDP growth may fall to 1.1 per cent in FY21 owing to

coronavirus crisis.The nominal GDP for FY21 could be around 4.2 per cent as there is a

possibility of subsidies outstripping tax collection.

Keypoints-

• Similarly, the rate of growth in FY20 is expected to fall to 4.1 per cent from 5 per

cent estimated by several agencies before the coronavirus outbreak.

• The lockdown extension could also lead to an economic loss of Rs 12.1 lakh

crore or 6 per cent of the nominal gross value added (GVA) .

• They also estimate the income loss per day of these 37.3 crore workers due to

lockdown is around Rs 10,000 crore, which translates into a loss of Rs 4.05 lakh

crore for the entire lockdown period.

• For causal labourers, this income loss is at least Rs 1 lakh crore.

• The net tax revenue may see a shortfall of nearly Rs 4.12 lakh crores, and

revenue shortfall for states may stand at Rs 1.32 lakh crores.

• The revised fiscal deficit would be at 5.7 per cent of GDP.

18. Smt. Nirmala Sitharaman attends the 2nd G20 Finance Ministers and Central

Bank Governors Meeting

Union Minister for Finance & Corporate Affairs, Smt. Nirmala Sitharaman participated in

the virtual session of the 2nd G20 Finance Ministers and Central Bank Governors

(FMCBG) meeting under the Saudi Arabian Presidency to discuss the global economic

outlook amid evolving COVID-19 pandemic crisis.

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19. Outlook for India’s economy bleak-IMF and Barclays

The International Monetary Fund (IMF) slashed its FY21 growth projection for India to

1.9% from 5.8% projected in January, holding that the ‘Great Lockdown’ to combat the

covid-19 outbreak will throw the world economy into the worst recession since the Great

Depression in 1930s.

Keypoints-

• The coronavirus pandemic came at a time when India’s economy was already

slowing, due to persistent financial sector weaknesses.

• The severe disruption of economic activities caused by covid-19, both through

demand and supply shocks, has overtaken the incipient recovery in the Indian

economy leading to massive job losses.

• IMF in its biannual World Economic Outlook projected the global economy to

contract sharply by 3% in 2020, much worse than during the 2008-09 financial

crisis. For India, it estimated a sharp economic recovery in FY22 at 7.4%.

• However, investment bank Barclays pared its growth forecast for India to 0% for

calendar year 2020 from its earlier projection of 2.5%.

• Barclays said combined with the disruption in several manufacturing and service

sectors, it now estimates that the economic loss in 2020 will be close to $234.4

billion or 8.1% of GDP.

• Rating agency Icra Ltd went a step further, projecting the economic growth at

anywhere between -1% and 1% in FY21, as it expects gross domestic product

(GDP) to contract 10-15% in the June quarter.

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20. HDFC Bank launches Safety Grid campaign for social distancing

HDFC Bank has launched a campaign to encourage and reinforce social distancing

while waiting at shops.

Using the outer grid of HDFC Bank logo, it has created physical markers on the ground

to help people maintain the World Health Organisation (WHO) prescribed social

distance. After a pilot in Kolkata, the Safety Grid campaign has been launched in

Mumbai, Delhi, Bengaluru, Kolkata, Hyderabad, Pune, Chandigarh and Bhubaneswar.

HDFC Bank

HQ- Mumbai

Tagline- We understand your world.

21. Exports plunges by 34.57% in March, 4.78% in FY20

India's exports plunged by a record 34.57 per cent in March due to a steep decline in

shipments of leather, gems and jewellery and petroleum products, dragging the total

exports in 2019-20 down to $314.31 billion. Merchandise exports in March stood at

$21.41 billion, down by 34,57 per cent compared to $32.72 billion in the same month

last year.

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22. Business sentiment worsened in Q4 FY20: NCAER

According to the economic think-tank NCAER’s Business Expectations Survey ,

business sentiments, which were already weak to start with, worsened further in the

fourth quarter of 2019-20 amid the coronavirus crisis.

Keypoints-

• NCAER''s Business Confidence Index (N-BCI), an indicator of business

sentiments across Indian industry, stood at 77.3 in Q4 of 2019-20.

• N-BCI fell from 111.2 in the third quarter of 2019-20 to 77.3 in next three months,

declining by 30.4 per cent on a quarter-on-quarter (q-o-q) basis and by 32.9 per

cent on a year-on-year (y-o-y) basis.

• All the four components comprising the BCI -- overall economic condition,

investment climate, firms’ financial position and capacity utilisation -- experienced

deterioration in sentiments on a quarterly basis.

• NCAER further said the Political Confidence Index (PCI) fell from 96.2 per cent in

January 2020 to 73.7 per cent in April 2020, falling by 23.4 per cent on a q-o-q

basis and by 31.3 per cent on a y-o-y basis.

• Six components showed deterioration in sentiments -- managing the exchange

rate, overall economic growth, managing inflation, pushing economic reforms

forward, external trade negotiations and managing government finance.

However, sentiments improved in the case of two components -- managing a

conducive political climate and managing unemployment.

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23. Equitas Small Finance Bank allows customers to open fixed deposits and

savings accounts online

Equitas Small Finance Bank, has said that new customers can 'self-onboard' to open a

savings account or invest in a fixed deposit with no physical contact or branch visits

during the on-going coronavirus lockdown.Customers can open a 'Selfe Fixed Deposit'

online for up to Rs 90,000 by using their Aadhaar Number and PAN.

Features of Selfe FD are Interest up to 7.75 per cent per annum for 1 year, 0.60 per

cent additional interest for senior citizens.

Equitas Small Finance Bank

HQ- Chennai

Tagline- It's Fun Banking

24. Govt-appointed panel proposes institutional framework for valuers, moots

National Institute of Valuers

A government-appointed committee of experts, headed by IBBI (Insolvency and

Bankruptcy Board of India) Chairperson M S Sahoo has proposed an institutional

framework for valuers by way of setting up the National Institute of Valuers. This panel

has also submitted the ''Draft Valuers Bill, 2020''.

Keypoints-

• The corporate affairs ministry sought comments on the bill, which has

recommended setting up of the institute.

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• The panel was constituted to examine the need for an institutional framework for

regulation and development of valuation profession.

• Based on a comprehensive study and analysis of all relevant issues and taking

the inputs of key stakeholders, the committee has submitted its report to the

Government of India, recommending to establish a National Institute of Valuers.

• According to the committee, there should be enactment of an exclusive statute to

provide for the establishment of the institute to protect the interests of users of

valuation services in India and to promote the development of, and to regulate

the profession of valuers and market for valuation services.

• Among others, the panel has suggested measures to ensure a minimum quality

of valuation services across the market.

25. Pandemic to bring Asia's 2020 growth to halt for 1st time in 60 years: IMF

According to the IMF, Asia's economic growth this year will grind to a halt for the first

time in 60 years, as the coronavirus crisis takes an "unprecedented" toll on the region's

service sector and major export destinations.

While Asia is set to fare better than other regions suffering economic contractions, the

projection is worse than the 4.7% average growth rates throughout the global financial

crisis, and the 1.3% increase during the Asian financial crisis in the late 1990s. The

region's export powerhouses were also taking a battering from slumping demand for

their goods by key trading partners such as the United States and European countries.

26. Ajay Mahajan appointed MD & CEO of CARE Ratings

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Ajay Mahajan has been appointed as Managing Director and Chief Executive Officer of

the CARE Ratings company for five years.

27. Vineet Arora appointed MD, CEO of Paytm General Insurance

Digital payments major Paytm has named Vineet Arora as the managing director and

chief executive officer of Paytm General Insurance Ltd.

The appointment, which is subject to regulatory approvals, is a step for Paytm to further

its journey into the insurance sector with an immediate focus on General Insurance.

28. IL&FS sells entire stake in IWPSL to ORIX Corp for Rs 6.05 crore

Infrastructure Leasing and Financial Services (IL&FS) has sold its 100 per cent stake in

IL&FS Wind Power Services Ltd (IWPSL) to ORIX Corporation, Japan, for Rs 6.05

crore. IWPSL, a wholly-owned subsidiary of IL&FS Energy Development Company

(IEDSL), is engaged in providing supervisory and management support services to

seven operating wind power generating special purpose vehicles (SPVs).

29. Centre releases 7,300 crore rupees to States & UTs under MGNREGS

Centre has released 7,300 crore rupees to the States and Union Territories

under Mahatma Gandhi National Rural Employment Guarantee Scheme

(MGNREGS) to liquidate pending dues of last financial year but also the wage

dues for the first fortnight of 2020-21. Now the focus should be on creating

durable assets relating to irrigation and water conservation.

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30. MEA announces COVID-19 training programme for SAARC countries

India has launched a capacity building programme for the health officials of SAARC

countries, which comes after New Delhi's initiatives like USD 10 million SAARC COVID-

19 fund, Rapid Response Teams of Doctors to assist the nations in combating the

coronavirus menace.

Ministry of External Affairs (MEA) through its ITEC -- Indian Technical and Economic

Program -- portal is conducting e-ITEC web-based short training, live webinars for the

healthcare professionals in SAARC and other neighbouring countries on COVID-19

management strategies and related aspects.

31. BSNL, SBI partner to launch UPI-based payment platform Bharat InstaPay

BSNL in partnership with State Bank of India launched a UPI-based payment platform,

Bharat InstaPay. Bharat InstaPay will help its partners do digital transactions on a real-

time basis.

Before this service, BSNL vendors had to wait for payment settlement to buy various

telecom services that they sold in market. This used to get further delayed on non-

working days.

32. Andhra Bank, Syndicate Bank chiefs appointed as OSD in different banks

Andhra Bank Managing Director J Packirisamy and Syndicate Bank Chief Executive

Officer Mrutyunjay Mahapatra have been appointed as Officer on Special Duty (OSD) in

the Union Bank of India and the Canara Bank respectively.The development comes

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after some of the public sector banks were merged by the government with effect from

this month.

33. Agri Ministry launches a call centre for agri logistics

The Agriculture Ministry has set up a call centre to ease the difficulties in agri logistics,

particularly the inter-State movement of perishable vegetables and fruits as well as agri

inputs such as seeds, pesticides and fertilisers.

The All India Agri Transport Call Centre, which will coordinate movement of produce

and agri inputs, can be accessed at 1800-180-4200 and 14488 from any mobile or

landline phone.

34. UN releases $2.5m to help cyclone-ravaged Vanuatu

The United Nations has released $2.5m from its emergency humanitarian fund to help

thousands of people affected by Cyclone Harold in the South Pacific island nation of

Vanuatu and offered support to other hard-hit countries.

35. RBI to slap 200 bps penal interest on banks if failed to invest TLTRO funds

within 30 days

If banks fail to invest TLTRO funds within 30 days, then RBI will have to pay a penalty of

200bps. The Reserve Bank warned banks that if they fail to invest 50 per cent of the

funds raised through the targeted long-term repo operations (TLTRO) route in corporate

bonds within a month, they will be fined 200bps extra.

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36. Govt launches Sovereign Gold Bonds Scheme 2020-21

The Government of India, in consultation with the Reserve Bank of India, is going to

launch new series of the Sovereign Gold Bond (SGB) Scheme.

Keypoints-

• The Sovereign Gold Bonds will be issued in six tranches.

• The Bonds, to be issued by the RBI on behalf of the Government of India, will be

sold through Scheduled Commercial banks (except Small Finance Banks and

Payment Banks), Stock Holding Corporation of India Limited (SHCIL), designated

post offices, and recognised stock exchanges such as BSE and NSE.

• Bonds will be tradable on stock exchanges within a fortnight of the issuance on a

date as notified by the RBI.

• The minimum investment limit for Sovereign Gold Bond is 1 gram of gold, while

the maximum limit of subscription is 4 kg for individual, 4 kg for HUF and 20 kg

for trusts and similar entities.

• The tenor of the Bond will be for a period of 8 years with exit option after

completion of five years.

37.Finance Minister Smt. Nirmala Sitharaman attends the Development

Committee Meeting of the World Bank-IMF

The Union Finance Minister, Smt Nirmala Sitharaman, participated in the 101st Meeting

of the Development Committee Plenary through video conference here today. The items

on the agenda included update on World Bank Group Response to the COVID-19

Emergency, and the Covid-19 Debt Initiative: International Call for Action in Support of

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IDA Countries.The Government has announced support measures worth US $ 23 billion

for COVID-19 pandemic.

38. Govt increases loss coverage for micro loan defaults to 75% from 50% earlier

The finance ministry has increased coverage of a lender’s loss in case of loan default

under the Credit Guarantee Fund for Micro Units (CGFMU) scheme to 75%, from 50%

earlier.

Keypoints-

• The amendment to the scheme is aimed at incentivising lending to micro

businesses which are bearing the brunt of the coronavirus outbreak and the

ensuing nationwide lockdown.

• The CGFMU scheme, announced in April 2016, covers micro loans up to Rs 10

lakh extended under the Pradhan Mantri Mudra Yojana.

• Lenders can pay a fee for the portfolio of loans they want to be covered by the

guarantee, which will enable them to provide easier credit while improving

profitability.

• Additionally, in a relief to borrowers, the ministry has clarified that personal

assets of the borrower will not be included in the definition of primary security for

the loan. From the borrower's perspective, it is a relief because if his loan

account turns bad, no collateral will be enforced.

• This means only assets created from the loan can be attached as part of the loan

recovery process and the personal assets of the borrower cannot be enforced as

collateral.

• The ministry has also reduced the burden of defaults the lender had to bear

under the scheme from the first 5% of the amount in default to 3%.

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• Another change in the scheme is the inclusion of loans to SHGs. Loans between

10 lakh and 20 lakh sanctioned to SHGs in the current fiscal will be covered

under CGFMU scheme.

39. Covid-19 impact: S&P slashes India growth forecast to 1.8% for FY21

Standard & Poor’s (S&P) slashed its FY21 growth estimate for India to 1.8% from 3.5%

projected last month on concern that the covid-19 peak in India will come “somewhat

later" than most other countries.

For the Asia-Pacific region, S&P pared its 2020 growth projection to 0.3% with

downside risks from 4.8% earlier, holding that the pandemic will lead to a loss in

household and corporate income of about $2.2 trillion.

40. India's TVS Motor Acquires Legendary British Bike Brand Norton Motorcycles

For Rs 153 Cr

TVS Motor has clinched a $20 million deal to buy British brand Norton Motorcycles.

The move now becomes the latest acquisition of a British auto manufacturer by an

Indian entity, after Tata Motors acquired Jaguar Land Rover more than a decade

earlier.

41. Retail inflation eases to 5.91% in March

Data released by NSO showed, India's retail inflation eased to 5.91% last month from

6.58% in February on a sharp fall in food inflation even as the Covid-19 outbreak is

expected to weigh on inflation numbers for April as factories slow production and data

collection gets hit. Food inflation at 8.76% in March was lower from 10.81% in February,

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Source- ET

42. Bank credit growth slumps to 5-decade low of 6.14% in FY20 over low demand

RBI data showed that Bank credit growth decelerated to an over five-decade low of 6.14

per cent in the fiscal ended March 31, 2020, amid a faltering economy, lower demand

and risk aversion among banks. Bank advances growth in FY20 was the slowest since

the fiscal ended March 1962, when loans had grown by 5.38 per cent.

Keypoints-

• In the week ended March 27, 2020, advances stood at Rs 103.71 lakh crore as

against Rs 97.71 lakh crore as on March 29, 2019,

• During FY20, bank deposits grew by 7.93 per cent to Rs 135.71 lakh crore as

against Rs 125.73 lakh crore.

• The growth in deposits was slowest since FY18, when it had increased by 6.21

per cent. In FY19, credit offtake was 13.29 per cent while deposits grew by 10.04

per cent.

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43. Yes Bank's rescue made smaller private banks more vulnerable- Moody's

According to Moody, the ripple effect of YES Bank rescue will make smaller private

sector banks in India vulnerable as event coincides with the Covid-19 outbreak and

aftermath.

Keypoints-

• The YES Bank moratorium, which occurred amid deteriorating economic

conditions globally following the Covid-19 outbreak, and acute volatility in

financial markets, will undermine depositor confidence in private sector banks.

• Alongside, public trust in public sector banks will remain strong, underpinned by

a perception of strong government protection for them.

• As a result, some private sector banks, particularly, small institutions will lose

deposits to PSBs, which will weaken their funding profiles.

• Earlier, PSBs have gradually lost deposit market share to private banks because

the latter offers higher interest rates and better customer service.

44. UNIDO and CUTS look to e-commerce to counter economic impact of COVID-19

The United Nations Industrial Development Organization (UNIDO) and the Consumer

Unity and Trust Society (CUTS) have signed an agreement to empower consumers to

contribute to the global development agenda as well as support their respective

governments in times of global crisis of COVID 19

UNIDO

HQ- Vienna, Austria

45. Fintech startup Setu raises $15 million in Series A funding

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Fintech infrastructure startup, Setu announced that it has raised $15 million as a part of

its Series A funding round, led by Falcon Edge and Lightspeed Venture Partners US

along with existing investors Lightspeed India Partners and Bharat Inclusion Seed Fund.

46.Paytm to offer ESOPs worth ₹250 crore to employees

Paytm (owned by One97 Communications Ltd.) said that it will offer 250 crore in

employee stock option plans (ESOPs) this year to its high performing employees and

new hires.Paytm said this will widen the base of employees having company.

47.MaxLifeIns, YES Bank extended bancassurance tie-up for 5 years

Max Life Insurance and YES Bank have extended their 15 years strategic

bancassurance partnership for five more years. In this regard, the both companies

dedicated the current financial year -FY 2020-21 as the “Year of the Customer”.

As a part of partnership, the products of the life insurer sold through the branches of

Yes Bank. Customers are offered with a broad range of need-based products and

services.

48.World Bank sees FY21 India growth at 1.5-2.8%; slowest since economic

reforms three decades back

According to the World Bank’s ‘South-Asia Economic Focus report ‘, India is likely to

record its worst growth performance since the 1991 liberalisation this fiscal year as

the coronavirus outbreak severely disrupts the economy. India's economy is expected to

grow 1.5 per cent to 2.8 per cent in the 2020-21. It estimated India will grow 4.8 per cent

to 5 per cent in the 2019-20 fiscal that ended on March 31.

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Source- ET

49. Government nod mandatory for FDI from neighbouring countries

The Government of India has reviewed the extant Foreign Direct Investment(FDI) policy

for curbing opportunistic takeovers/acquisitions of Indian companies due to the current

COVID-19 pandemic and amended extant FDI policy as contained in Consolidated FDI

Policy, 2017.

Keypoints-

• Department for Promotion of Industry and Internal Trade, Ministry of Commerce

and Industry has issued amended FDI policy

• The government said firms in neighbouring countries wanting to invest in Indian

companies will now be able to do so only after receiving its approval.

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• According to amendments to India’s consolidated FDI Policy, 2017, while non-

resident entities can continue to invest in India, except in prohibited sectors or

activities, firms in neighbouring countries will have to seek approval and can

invest only under the Government route.

• The decision comes days after China’s central bank, the People’s Bank of China

(PBoC) had raised its shareholding in Housing Development Finance

Corporation (HDFC) to over one per cent during the recent stock market slump.

50. RBI reduces FPI investment limits in G-secs to Rs 2.34 lakh crore for FY21

RBI reduced the general category foreign portfolio investors’ (FPI) investment limit in

central government securities to Rs 2.34 lakh crore for the entire fiscal year 2021 as

compared to the existing limit of Rs 2.46 lakh crore. As a result, the limits have been

brought down by almost $1.5 billion to just above $31 billion.

Keypoints-

• With continuous selling in the central government securities by foreign portfolio

investors (FPIs), general category FPI utilisation of investment limits in G-secs

have fallen to 52.62% compared to the peaks of over 75% at the beginning of

2020.

• In the last 19 consecutive sessions, FPIs have sold Indian bonds including both

G-secs and corporate bonds — worth $8.8 billion.

• At the same time, long term FPI investment limits in G-secs have been brought

down to Rs 1.03 lakh crore from the prevailing limit of Rs 1.15 lakh crore, a

reduction of almost $1.5 billion.