ISSUE: 331 2023 25 Sep 2023

RBI likely to keep interest rate

unchanged as inflation still high:
Experts: The Reserve Bank is likely to
maintain status quo on policy rates for the
fourth time in a row at its bi-monthly monetary
policy review meeting early next month, as
retail inflation continues to remain high and
the US Federal Reserve has decided to keep a hawkish stance for some
more time, according to experts. The Reserve Bank had raised the
benchmark repo rate to 6.5 per cent on February 8, 2023 and since then it
has retained the rates at the same level in view of the stubbornly high
retail inflation and certain global factors including elevated crude oil
prices in the international market. The Reserve Bank Governor-headed
six-member Monetary Policy Committee (MPC) meeting is scheduled for
October 4-6, 2023. The last meeting of the MPC, the highest rating-
setting panel, was in August.
(Moneycontrol)
India to pitch for agreement on permanent solution for food
security at WTO meet: Developing nations, including India, will make
a strong pitch for a permanent solution to their concerns on subsidy
limits placed on their public stockholding programmes at the WTO Senior
Officials‟ meeting scheduled next month, sources have said. The meeting
has been called by the WTO Secretariat, on October 23-24, to work out
the agenda for WTO‟s 13th Ministerial Conference in February 2024.
“India has been calling for a permanent solution on calculation of its MSP
subsidies, and the limits put on them by the WTO, as the programme is
crucial for food security of the country. This is what the country will
highlight at the WTO Vice Ministers meeting together with some other
issues such as a long transition period for developing nations to curb
fisheries subsidies and removal of moratorium on customs duties on e-
commerce trade,” a source tracking the matter told.
(Business Line)
Govt considers giving financial creditor status to insurers
issuing surety bond during resolution: To make surety bond
business more attractive, the government is looking at making relevant
changes in the Insolvency and Bankruptcy Code (IBC) to consider
insurers as financial creditor in case of default of infra projects.The surety
bond issued by a general insurance company is a three-party contract by
which one party (the surety) guarantees the performance or obligations of
a second party (the principal) to a third party (the obligee).The surety is a
company that provides the financial guarantee to the obligee (usually a
government entity) that the principal (business owner) will fulfil their
obligations. According to sources, the Ministry of Corporate Affairs is
looking into concerns raised by the insurers that they should have
recourse to recovery on par with the banks as forwarded by the
Department of Financial Services under the finance ministry.
(Financial Express)

PSBs set to shine with JP Morgan’s bond

inclusion boost: Public sector banks (PSBs) are
set to enjoy substantial gains in their treasuries as
G-sec yields are expected to slide following JP
Morgan‟s decision to include India in its emerging-
markets bond index. The anticipation of this
inclusion already pushed the ten-year G-sec yields down from 7.28 per
cent on September 18 to 7.08 percent on Friday after the index inclusion
news. PSBs are likely to benefit from marked-to-market gains in their
treasuries for the September quarter, with some even considering
booking substantial profits by selling their bond holdings, a banking
industry insider said. This yield decline may also prompt some PSBs to
pay off high-cost debts by reducing their government bond holdings.
PSBs, in particular, keep a higher Statutory Liquidity Ratio (SLR) and
hence may benefit a bit more in comparison to the rest.
(Moneycontrol)
SIDBI signs pact with DLAI to boost fintech sector: The Small
Industries Development Bank of India (SIDBI) has signed a
Memorandum of Understanding with the Digital Lenders Association of
India (DLAI) to support the country's fintech sector. The agreement aims
to develop standard protocols for digital lending partnerships, including
alliances between banks and Lending Service Providers (LSPs).
(Economic Times)
ICICI Lombard appoints Sanjeev Mantri as MD & CEO of
company: Sanjeev Mantri who is the current executive director of ICICI
Lombard has been appointed as the new Managing Director (MD) and
Chief Executive Officer (CEO) with effect from December 1, 2023, said the
company through its exchange filing on Sunday.
(Economic Times)

Tata Projects bags contract to build

Micron’s $2.75 billion semiconductor
plant in Gujarat: TATA Projects has
bagged the contract to build Micron
Technology‟s advanced semiconductor
assembly and test plant in Sanand, Gujarat.Situated in the Gujarat
Industrial Development Corporation area of Chaarodi, Sanand, the
project spans an expansive 93 acres of land. The construction of Phase 1
will include a 5,00,000 square feet cleanroom space, scheduled to be
operational by late 2024. Micron had earlier announced plans to build
India‟s first semiconductor unit for $2.75 billion. Of this, Micron will be
investing $825 million (around ₹6,760 crore) and the balance will come
from the government in two phases.The project encompasses the design
and construction of a first-of-its-kind DRAM and NAND assembly and
test facility in India. DRAM is the memory used to store code for
algorithms, processes and NAND is the memory used to store data for
pictures, music.
(Business Line)
Tata Motors sets up vehicle recycling plant in Surat: Tata Motors
has launched its third vehicle scrapping unit with the capacity to
disassemble 15,000 end-of-life vehicles. The facility in Surat, developed
and operated by Tata Motors‟ partner Shree Ambica Auto, scraps end-of-
life passenger and commercial vehicles of all brands. The first two
facilities are in Jaipur and Bhubaneswar.
(Business Line)

New TCS norms on expenditure under LRS to come into effect

from Oct 1,: New mechanism of Tax Collected at
Source (TCS) on Liberalised Remittance Scheme
(LRS) beyond a certain threshold to October 1.
However, there is no clarity when transactions
through International Credit Cards while being
overseas would be counted as LRS and attract TCS.
There is no change in TCS norms on expenditure related with education
and medical, but for other purposes and buying the overseas travel
package beyond ₹ seven lakh, rate of TCS would rise to 20 per cent from
five per cent. There is no TCS in case of expenditure up to ₹ seven lakh in
a year for education, financed by loans After this threshold, TCS rate is
0.5 per cent. In case of self-financed remittance, the threshold will be
same, but the applicable TCS rate is five per cent. TCS on LRS for medical
treatment is NIL for expenses upto ₹ seven lakh, but five per cent for
more than ₹ seven lakh.
(Business Line)
IBBI chief calls for efforts to improve bidders’ confidence:
Insolvency Professionals (IPs) should make every possible effort to
improve the insolvency ecosystem in the country, Ravi Mital,
Chairperson, Insolvency and Bankruptcy Board of India (IBBI) has said..
This will increase the confidence of prospective bidders in the stressed
assets and ensure better resolution of the corporate debtors, Mital said at
a conference on “Developing Markets for Stressed Assets in India”
organized by Indian Institute of Insolvency Professionals of ICAI (IIIPI).
“IPs should compile delays and litigations and find out ways to minimize
them. If delays are reduced, venture capitalists will be encouraged to
invest in stressed assets,” Mital said. He also suggested that IPs revisit
the companies which they had resolved through resolution plans under
the IBC, after 4 to 5 years of their resolution. They should prepare
“success stories”, which will be useful in creating a positive environment
for investment in stressed assets, he added.
(Business Line)
Ek Tareekh Ek Ghanta Ek Saath: Nine years ago, Prime Minister
Shri Narendra Modi,gave a clarion call for swachhata in 2014. Citizens
from allwalks of life reciprocated with immense enthusiasm taking the
ownership for Swachh Bharat. As a result,swachhata became a national
behaviorand Swachh Bharat Mission became a household name. As a run
up to Gandhi Jayanti, a unique call to action has been given by the Prime
Minister to fellow citizens. On 105th episode of Mann Ki Baat, Prime
Minister, appealed for 1 hour of shramdaan for swachhata at 10 am on 1st
Oct by all citizens collectively will be a „swachhanjali‟ to Bapu on the eve
of his Jayanti. Speaking on Swachhata Hi Sevaabhiyan,
(PiB)

RBI KEY RATES FOREX EQUITY

(RBI REF. ) /COMM. MARKET
Repo Rate: 6.50% INR / 1 USD : 82,9477 Sensex: 66009.15 (-221.09)
SDF: 6.25% INR / 1 GBP : 101.8692 NIFTY: 19674.30 (-68.00)
MSF /Bank Rate: 6.75% INR / 1 EUR : 88.3470 Bnk NIFTY: 44612.10 (-11.70)
CRR: 4.50% INR /100 JPY: 55.9900 Gold: 58,939.00 (+117.00)
SLR: 18.00% Silver: 73,408.00 (+340.00)
FINANCIAL CONCEPTS
DECENTRALIZED AUTONOMOUS
ORGANIZATION (DAO)
 A DAO is a group of people who work together toward
a shared goal and abide by rules written into the
project‟s self-executing computer code. Bitcoin (the
project, not the currency) is the earliest example of a DAO.
 A decentralized autonomous organization is an entity structure in which tokenholders
participate in the management and decision-making of an entity.
 There is no central authority of a DAO; instead, power is distributed across
tokenholders who collectively cast votes.
 All votes and activity through the DAO are posted on a blockchain, making all actions
of users publicly viewable.
 One of the first DAOs named The DAO was an organization created by developers to
automate decisions and facilitate cryptocurrency transactions.
 One of the major features of digital currencies is that they are decentralized. This
means they are not controlled by a single institution like a government or central
bank, but instead are divided among a variety of computers, networks, and nodes. In
many cases, virtual currencies make use of this decentralized status to attain levels of
privacy and security that are typically unavailable to standard currencies and their
transactions.
 DAOs rely heavily on smart contracts. These logically coded agreements dictate
decision-making based on underlying activity on a blockchain.

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