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QBiz: IMF Retains 7.3% Growth For India; Rupee Slips To New Low

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1. IMF Retains India FY19 Growth Outlook At 7.3%

The International Monetary Fund (IMF) has retained its India growth forecast for the current year and marginally pared it for next fiscal, citing the drag from higher crude prices and tightening of the global financial situation. But it will remain the fastest-growing major economy, well ahead of China, it said.

In its latest World Economic Outlook, the IMF said India will grow 7.3 percent in FY19 and 7.4 percent in FY20. It had in January forecast FY20 growth at 7.5 percent. China is forecast to grow 6.6 percent and 6.2 percent in 2018 and 2019, respectively. The Indian economy grew 6.7 percent in FY18.

“This acceleration reflects a rebound from transitory shocks (the currency exchange initiative and implementation of the national goods and services tax), with strengthening investment and robust private consumption,” the IMF said. The forecast for investment growth in FY19 is weaker than in April, despite higher capital spending.

India’s medium-term growth prospects remain strong at 7.75 percent, benefiting from ongoing structural reform and a favourable demographic dividend, the report said.

(Source: The Economic Times)

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2. SC Sends 3 Amrapali Group Directors To Custody

The Supreme Court on Tuesday, 9 October, ordered three directors of realty major Amrapali Group of Companies to “remain in the custody of the police” till they hand over documents and account books the bench has sought in a case of alleged fraud on 46,000 homebuyers.

Police took Anil Kumar Sharma, Shiv Priya and Ajay Kumar into custody following the order from the bench of Justices Arun Misra and UU Lalit.

The three have to remain in custody till they hand over all the required documents to two court-appointed “forensic auditors”.

“All the documents to be handed over to forensic auditors by the police. In case the aforesaid persons fail to hand over the documents as ordered, they shall remain in the custody of the police till such time the documents are handed over.” the bench said.

It asked Delhi and Uttar Pradesh Police to take necessary action while fixing 24 October for the next hearing.

(Source: The Telegraph)

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3. Indiabulls Housing Hikes Lending Rates

Indiabulls Housing Finance Ltd said that it has raised retail lending rates by 20 basis points to accommodate for the recent spike in interest rates in the economy.

"The increase in lending rates reflects the rise in the cost of funds," the lender said in a statement.

Loans of up to Rs 35 lakh will be disbursed at an interest rate of 8.8 percent per annum, while loans bigger than that will attract interest rates of 8.95 percent.

According to an official of the company who spoke on the condition of anonymity, the effective lending rates for builder loans have been increased by 100 basis points. The benchmark rate for such loans has been increased by 200 basis points to 14.9 percent, with effect from 1 October.

(Source: BloombergQuint)

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4. Rupee Plunges To New Record Low Of 74.39 On Dollar, Crude Surge

The rupee on Tuesday, 9 October inched closer to the 75 level against the US dollar and plunged another 33 paise to close at a record low of 74.39 hit by a surge in crude oil prices and strength in the American dollar.

The rupee, which closed lower against the dollar for the sixth session in a row, also spooked the stock markets with the BSE Sensex erasing all early gains during the day to end 175 points lower in choppy trade at 34,299.47.

The Indian currency has depreciated close to 14 per cent from the beginning of the financial year (April 2018) when the exchange rate was 65.18 against the dollar. The weakness in the rupee is often seen as a plus point for exporters but adversely affects importers, mainly oil marketing companies.

(Source: The Indian Express)

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5. Swiggy, Zomato & Other Apps Junk 10,500 ‘Unsafe’ Eateries

Leading e-commerce food delivery platforms like Zomato, Swiggy, UberEats and Food Panda have delisted 10,500 restaurants as they did not have the food safety regulator’s approval.

The move comes after a strict directive was issued in July this year by the Food Safety and Standard Authority of India (FSSAI) asking e-commerce sites to remove all unlicensed and non-registered restaurants from their listings by 30 September.

In a latest review of its order, FSSAI found that Zomato has delisted 2,500, Swiggy 4,000, Foodpanda 1,800, and UberEats 2,000 partner hotels.

Around 200 restaurants on other platforms too have been axed. “These food aggregators have been directed to share the list of delisted Hotels/Restaurants so that action can be initiated against the defaulters under the Food Act,” FSSAI said.

FSSAI’s order was triggered by a series of complaints received by the regulator about substandard food being supplied by restaurants.

(Source: The Times of India)

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6. Honda To Invest Rs 9.2K Cr, Largest For India’s Car Biz

Japanese car major Honda plans to pump in over Rs 9,200 crore, its largest investment for India, to set up a third factory to launch hybrid and electric vehicles, and drive in new models and upgrades.

The fresh investment will double the company’s financial commitment in India to over Rs 18,500 crore since it began operations in 1998. “India is one of the most critical markets for Honda globally, and we want to strengthen our operations here,” Honda Cars India president & CEO Gaku Nakanishi said. “The new investment which we plan to make over the next decade signals our commitment towards the growth potential in the Indian car market and underlying strength here.”

Honda currently has two factories — the first one at Greater Noida in Uttar Pradesh and the second at Tapukara in Rajasthan. The company’s installed production capacity stands at 2.8 lakh units annually, higher than 1.7 lakh units it sold in 2017-18.

(Source: The Times of India)

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7. WhatsApp Sets Up A System To Store Payments-Related Data In India

Facebook-owned messaging platform WhatsApp has built a system that stores payments-related data in India, in line with the Reserve Bank of India (RBI) mandate for data localisation.

A few financial services players, however, say that greater clarity of the norms is required and the deadline should be extended as it takes time to build data centres.

WhatsApp has been running a pilot project of its payments services in India for the past few months. The government had earlier told the company to comply with the localisation norms before getting a go-ahead for a full-fledged launch.

In April, the RBI had asked all service providers to store financial data in India. They were given six months to comply with the mandate and the deadline will end on 15 October.

The mandate for data localisation has divided the firms. While global payments firms are proposing free flow of data, local providers, such as Paytm, are supporting mandatory localisation.

(Source: Business Standard)

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8. Tata Motors Dives 20% To Hit Near Seven-Year Low On JLR Woes

Shares of Tata Motors Ltd on Tuesday, 9 October, slumped nearly 20 percent to hit a near seven-year low after Jaguar Land Rover reported a 12.3 percent decline in global sales. Investor sentiment was also dampened after the company announced a shutdown of its West Midland plant for two weeks due to weak global demand.

The stock touched a low of Rs 170.65 a share, a level last seen on 30 December 2011, and fell as much as 19.8 percent in intraday trading. Tata Motors shares closed at Rs 184.25 per share on BSE, down 13.40 percent from its previous close. So far this year, Tata Motors has dropped over 60 percent.

JLR reported retail sales at 57,114 cars in September, down 12.3 percent from a year ago. Its sales were down a modest 0.8 percent in the UK and 4.7 percent in Europe. In North America, sales were 6.9 percent lower.

The company said it would stop production at the Solihull plant in the UK for two weeks.

(Source: Livemint)

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9. Jet Airways Delays September Salaries Of Pilots, Engineers, Senior Management

Jet Airways is once again delaying salaries of its pilots, engineers and senior management.

The airline has paid 25 percent of the August salary that was due on 9 October but informed them that the September salary would be delayed.

"Owing to unprecedented circumstances, including the continuing rise in the price of brent fuel and the appreciation of the US dollar, there will be a delay in the payment of the September 2018 payroll," the airline's chief people officer Rahul Taneja wrote in an email to employees. No date was specified for the disbursal of salaries for September and the email said the company would try to clear the payments at the earliest.

Jet Airways, which has posted huge losses in successive quarters, announced last month that it would pay pilots, engineers and senior management in two equal instalments.

(Source: Business Standard)

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