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QBiz: Budget to Mention Saubhagya Scheme, SBI Increases Dep Rates 

Here is a roundup of the top business stories of the day.

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1. Saubhagya Scheme Likely to Find Mention in Budget 2018

Given its electoral potential, Finance Minister Arun Jaitley’s Budget speech is expected to extol the benefits of Pradhan Mantri Sahaj Bijli Har Ghar Yojana, or the Saubhagya scheme.

Prime Minister Narendra Modi launched the Rs 16,320 crore scheme last year to provide electricity connections to more than 40 million families in rural and urban areas by December 2018, and help achieve universal electricity access.

“Saubhagya will be talked about in the Budget speech,” said a senior government official requesting anonymity.

The scheme funds the cost of last-mile connectivity to willing households. According to the contours of the scheme, a service cable will be drawn from the nearest electricity pole to the household premise where an electricity meter will be installed along with the wiring for a single light point with an LED bulb and a mobile charging point.

(Source: Livemint)

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2. SBI Increases Rates on Bulk Deposits by up to 125 bps

State Bank of India (SBI), the country’s largest lender, on Tuesday raised interest rates on deposits of over Rs 1 crore by 40-125 basis points (bps).

This is the second time the bank has raised rates on bulk deposits in as many months. Rates on one-year deposits were raised by 100 bps to 6.25 percent, while those on deposits with maturities of two years or more were hiked by 75 bps to 6 percent. SBI is not the only large bank to have raised bulk-deposit rates in recent months.

ICICI Bank’s one-year bulk-deposit rate (for amounts between Rs 1 crore and Rs 100 crore) has increased to 6.85 percent from 6.5 percent after multiple rounds of revision since 19 December 2017.

(Source: Financial Express)

3. Only 28% of Urban India Lives in Rented Houses: Economic Survey

A mere 28 percent of India’s city dwellers live in a rented house, which is a steep decline from the scenario in 1961 when a majority of them (54 percent) used to live in a rented house instead of owning one, according to a longitudinal analysis of India’s housing pattern undertaken by the Economic Survey 2017-18.

While India is in the middle of a “Housing for All” mission, which aims to build 3 million houses in urban areas alone, the survey flags the cost of over-reliance on house ownership at the expense of other models of dwelling.

While reliance on renting as a practice has declined, there has been a dramatic rise in the number of houses lying vacant in cities across the country. According to the survey’s analysis of census figures, 12 percent of the total housing stock in urban India remains vacant.

(Source: Livemint)

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4. India Asks EU for Relaxed Blacklisting Norms

India on Monday urged the European Union (EU) not to ban or blacklist any seafood exporter immediately after finding problems with one consignment as this extreme step will work against the interests of all the stakeholders, Marine Products Export Development Authority (MPEDA) sources said.

Last year, the EU had raised the limit for testing of marine imports from 10 percent of consignments presented for import at border inspection posts to 50 percent due to the widespread presence of antibiotics in the aquaculture farms.

“EU should issue a warning to the exporter and give them reasonable time to remove the inadequacies before de-listing the company,” A Jayathilak, chairman of MPEDA said while chairing the EU-India Shrimp Dialogue organised in association with the Embassy of the Netherlands.

Instant blacklisting was unjust as this will destroy the exporters’ reputation built over several years and will jeopardise their huge investments in the cost-intensive business besides affecting the livelihood of lakhs of farmers, he added.

(Source: Financial Express)

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5. India Can’t Ignore US Corporate Tax Cuts: Arvind Subramanian

India will have to respond in kind to the trend of developed countries, such as the US, lowering their corporate tax rate to ensure that it remains an attractive destination for foreign capital and prevent the erosion of competitiveness of domestic companies, said chief economic adviser (CEA) Arvind Subramanian.

The corporate tax rate was slashed to 21 percent from 35 percent after the US adopted the Tax Cuts and Jobs Act in December, aimed at making businesses invest locally and to incentivise and repatriate profits held abroad.

“Nobody is preventing us from responding to it. If you want to be investor-friendly, you need to have policies to do that,” Subramanian said in response to a query on the impact of the US tax cut on investments in India.

The chief economic adviser said the government is working on a new direct taxes code for which a panel (led by Arbind Modi, member, Central Board of Direct Taxes) has been set up.

(Source: Livemint)

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6. Sebi Orders Utkarsha Plotters, Directors to Wind up CIS

Markets regulator Sebi today directed Utkarsha Plotters and Multi Agro Solutions India and its three directors to wind up within three months a collective investment scheme (CIS) through which the firm had mobilised over Rs 38 crore from investors.

According to an order, the regulator would "immediately" initiate recovery proceedings against the firm and its directors – Mitharam Chhagan Gurav, Dipali Mitharam Gurav and Pravin Chhagan Gurav – if they fail to close the scheme within the stipulated time limit.

While restraining the firm and its directors from mobilising funds under any CIS, the regulator had also directed them to wind up the existing scheme and refund the amount collected from investors with returns due to them.

Sebi also denied the request of the four entities to grant a time extension of five years to refund the investors.

(Source: PTI)

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7. Mahindra Planning Electric Cabs, EV Parts Supply Business

Mahindra and Mahindra Ltd plans to start a business that will operate a fleet of electric cabs and turn its electric vehicle (EV) manufacturing unit into a supplier of parts to EV makers.

India’s largest maker of EVs plans to turn its unit Mahindra Electric Mobility Ltd, which makes the e20Plus electric car, into a supplier of batteries, starter motors, power electronics and transmission to its parent and other vehicle makers.

“We have a different model for Mahindra Electric now, which (the company) is now a provider of electric kits and not a maker of Mahindra electric vehicles,” Pawan Goenka, the 63-year-old managing director of Mumbai-based Mahindra, said in an interview.

"If we get into mobility service, that will be the third business,” he said, adding the electric cab services business is likely to be named Mahindra Mobility Services.

(Source: Livemint)

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8. Intellect Design Arena Q3 Net Profit at Rs 12.16 Cr

T firm Intellect Design Arena today said it has posted a consolidated net profit of Rs 12.16 crore for the December quarter this fiscal.

The Chennai-based company had reported a net loss of Rs 16 crore during the same period of the previous year, Intellect Design Arena said in a statement. Its revenue from operations increased to Rs 270.67 crore in the said quarter as against Rs 226.45 crore in the year-ago period, it added.

The company's revenues for January-December 2017 crossed the Rs 1,000 crore-milestone and stood at Rs 1,031 crore.

"The achievement of Rs 1,000 crore mark in CY2017 establishes our business stability and is a palpable evidence of sustainable growth," Intellect Design Arena Chairman and MD Arun Jain said.

(Source: PTI)

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9. Corporate Governance Enhances Image, Profitability of Cost

Corporate Affairs Secretary Injeti Srinivas on Tuesday said corporate governance is in the interest of companies as it enhances their image and profitability.

"The challenge before India is to figure out a way to internalise Corporate Governance. Corporate Governance is in the interests of companies as it enhances their image, acceptability and profitability," an official statement quoted Srinivas as saying.

He was addressing the cooperation agreement signing ceremony between the Indian Institute of Corporate Affairs (IICA) and International Finance Corporation (IFC).

"Good governance is the key to sustainability of any initiative, be it companies or the government," Srinivas said.

(Source: PTI)

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