1. Arun Jaitley Hopes to Pass GST Bill in Second Half of Budget Session: Livemint
The current budget session of the Parliament will be “extremely important” to bring about
structural reforms, such as the goods and services tax (GST) and bankruptcy law, which
could help India sustain its growth momentum and provide support to a fragile global
economic growth, Union finance minister Arun Jaitley was quoted saying in a Livemint report.
These two legislation will give a major push to government’s reforms agenda, Jaitley said at the concluding ceremony of the Advancing Asia conference organised jointly by the International Monetary Fund (IMF) and the ministry of finance.
The budget session of Parliament will go into a recess starting 17 March and will reassemble on 25 April to conclude on 13 May.
2. Any Inflation Shock May Dent Market Confidence: ET
A key domestic economic reading and the outcome of the US Federal Reserve’s rate setting meeting will determine whether the stock markets extend their upsides this week, according to an Economic Times report. The government will announce the February inflation data on Monday — which is perceived by the market to play a role in the Reserve Bank of India’s (RBI) next monetary policy decision.
Stock market indices have gained 7-8 percent so far in March after the Union Budget maintained stiff fiscal deficit targets, raising expectations of monetary easing by the RBI.
However, fund managers and economists feel the rally in the last couple of weeks has discounted the possibility of a 25-basis-point rate cut on 5 April or before that. So, if the inflation rate exceeds estimates, the stock market could be disappointed, said analysts.
3. SEBI Clampdown Busts over Rs 15,000 Cr Worth Tax Evasion: FE
In a major clampdown, regulator SEBI has debarred over 1,000 entities from the capital markets
after they were found to be misusing stock exchange platforms for tax evasion to the tune of
more than Rs 15,000 crore.
According to Financial Express, SEBI has also suspended trading in shares of as many as 167 companies, while the regulator has written to the Income Tax Department in nearly 100 cases where more than 1,800 entities are suspected to have traded in shares valued beyond their disclosed income.
Such activities were mostly happening through shares of shell companies or thinly-traded penny stocks. There has not been any instance of a blue-chip stock being used for generating bogus profits or losses to evade taxes.
4. Big-Ticket Divestment in the Offing: BS
The success of the Container Corporation of India (Concor) and NTPC offer for sale within a couple of weeks of each other seems to have buoyed the government’s chances of raising more funds through disinvestments, reports Business Standard.
The actual
numbers at Rs 19,500 crore are less than half the targeted amount.
Market players say the government is likely to attempt, at least, one big-ticket sale this month. The likely candidates could be Coal India or Oil and Natural Gas Corporation.
It seems the government has already sounded out banks and insurers, particularly Life Insurance Corporation, to keep the powder dry.
5. RIL Arm to Invest Rs1,300 Crore in Haryana for Electronics Hub: Livemint
Reliance Industries’ wholly-owned arm Model Economic Township will develop an electronics
manufacturing hub and footwear park at Jhajjar, Haryana with an investment of Rs.1,300 crore, according to Livemint.
Model Economic Township, formerly known as Reliance Haryana SEZ, also expects that the electronic hub and footwear park would attract further investments of Rs 2,600 crore from units to be established inside it while generating about 20,000 employment opportunities.
The firm has signed two MOUs (memorandum of understanding) with the Haryana government at the ‘Happening Haryana’ global investors summit to develop 450-acre electronic manufacturing clusters and 500-acres footwear park.
The proposed electronic hub and footwear park is part of 8,000 acre industrial town being developed by the company.
6. DBS to Buy Royal Bank of Scotland’s Indian Onshore Ops for Rs 1,000 Cr: ET
DBS Group Holdings, southeast Asia’s largest bank, is set to acquire Royal Bank of Scotland Group’s Indian onshore operations for about Rs 1,000 crore, a much-awaited deal that will see the exit of Britain’s biggest government-owned bank from one of the fastest-growing economies. The deal is likely to close this week, reports the Economic Times.
The transaction includes three main parts of RBS’ India operations — a network of 10 branches, corporate loan platform and debt capital market, two people familiar with the matter were quoted in the report.
RBS had a balance sheet of Rs 19,000 crore and loan book of Rs 11,150 crore as of March 2015, according to financial statements posted on its website. “For the entire business, including debt corporate market division, corporate loan portfolio and branch networks, the price is likely to be around Rs 1,000 crore, which would be much below the net worth of India operations.”
7. IMF Chief Praises Raghuram Rajan for Taking Bad Loans ‘Head on’: ET
The move to address the issue of bad loans “head on” was absolutely right, International
Monetary Fund Managing Director Christine Lagarde was quoted in an Economic Times report,
lauding Reserve Bank of India Governor Raghuram Rajan’s efforts on cleaning up banks’ balance sheets.
The fact that the central bank governor is addressing the issue of bank balance sheets head on is absolutely right...equally relevant are various mechanisms that are being worked out with bad loans and distressed assets that are sitting on banks’ balance sheets and are clearly clogging themChristine Lagarde, Managing Director, International Monetary Fund
She said that since the country’s banking system seems to be well capitalised, this effort to reinforce and strengthen the system is well taken. However, in contrast to Rajan’s Saturday warning, Lagarde favoured continuing unconventional monetary policies in countries where inflation is very low.
8. BSE Looks to Prevent Trade Reversals in Equity Derivatives: FE
To ensure safety of the securities markets, top stock exchange Bombay Stock Exchange (BSE) will introduce a new
mechanism to automatically cancel reversal trades executed on its equity derivatives
segment from this week, reports Financial Express.
The new mechanism, Reversal Trade Prevention Check (RTPC), is aimed at preventing potential cases of trade reversal taking place on the exchange’s trading platform which may have been undertaken for the purposes of tax evasion.
It will act as a preventive measure wherein the second leg of a potential reversal trade will be automatically cancelled by trading system at the time of order matching in an on-line real time manner.
The exchange is implementing the new measure with effect from 14 March 2016.BSE
9. Bankers Create Security Charges on Collaterals to Avoid CBI, CVC Glare in Future: ET
Fearing a witch-hunt, increasingly wary bankers are doing all they can to shield themselves
from the glare of government investigation agencies, reports Economic Times.
Amid a growing risk-aversion, they are taking joint, unanimous decisions while dealing with large borrowers to escape finger-pointing by anyone later; creating security charges on all collaterals and hypothecations to make exposures fully secured; preserving minutes of meetings; and, insisting on quick, corrective action by promoters of borrowing companies if forensic audits reveal uncomfortable observations.
Also, the downsides for a company that is drawing credit are being examined more closely. These are some of the steps that lenders, lead by large banks, are resorting to before releasing the entire money.
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