QBiz: RBI Lowers Growth to 6.7%; Google Pixel 2 in India from Nov
The Quint brings the top business stories from the previous day.
1. Won't Mortgage India's Future for Votes: Narendra Modi
Signalling that there would be no retrospective investigation of the books of companies joining the formal economy, Prime Minister Narendra Modi said his government was committed to ensuring macroeconomic stability, more investor-friendly initiatives and creating an environment to encourage honest business practices.
Addressing the golden jubilee celebrations of the Institute of Companies Secretaries of India, Modi for the first time directly addressed criticism that the National Democratic Alliance (NDA) has mismanaged the Indian economy – especially after the first quarter showed that economic growth slowed sharply to 5.7%.
2. RBI Lowers Growth Forecast to 6.7%, Holds Repo Rate Citing Risk to Inflation
Home and auto loan rates are unlikely to change, after the Reserve Bank of India (RBI) left its key policy rate unchanged on Wednesday, citing higher risks to inflation.
The central bank slashed its growth forecast and raised its inflation forecast. Economists said rate cuts in the near term are unlikely as RBI waits for the growth and inflation situation to evolve.
On Wednesday, the six-member monetary policy committee left the repurchase (repo) rate – the rate at which RBI lends money to banks against bonds – unchanged at 6%. The decision was not unanimous. Ravindra Dholakia, one of the three external members of the panel, pressed for lowering rates by at least 25 basis points. One basis point is one-hundredth of a percentage point.
The central bank cut its growth projections for gross value added, a measure of economic output, to 6.7% from 7.3% for the current financial year.
Source: Hindustan Times
3. Google Unveils Pixel 2 & Pixel 2 XL, Prices Begin at Rs 61K – To Be Available in India From November
Tech giant Google on Wednesday unveiled the second generation of its Pixel smartphone - Pixel 2 and Pixel 2 XL - which will be available in India from 15 November priced at Rs 61,000 on wards.
The devices, which will compete in the premium segment with devices like Apple's iPhone 8 and X as well as Samsung's Note 8, will be available in five other markets including the US, the UK and Australia.
Google said that with Pixel, it has "created the world's best smartphone camera".
4. Fuel Price: Onus Now on States to Cut VAT
The scope of a further reduction in fuel prices is likely with the pressure now on States to lower the Value Added Tax on petrol and diesel, after the Centre cut excise duty on these products on Tuesday.
The issue is also likely to be taken up at the GST Council meeting on 6 October.
Petroleum and Natural Gas Minister Dharmendra Pradhan has asked State governments to follow the Centre and lower VAT levied. “I urge State governments to reduce VAT on petrol and diesel by 5 percent to give more relief to consumers,” he had said.
Source: The Hindu Business Line
5. Rajnish Kumar New SBI Chairman as Arundhati Bhattacharya Retires
Rajnish Kumar, 59, the senior most of the managing directors at State Bank of India (SBI), will become the 25th chairman of the country’s largest lender, succeeding Arundhati Bhattacharya, who is set to retire on 6 October.
The government on Wednesday announced his appointment for three years. Kumar currently is in charge of retail banking at SBI.
Kumar’s appointment comes at a time when SBI’s profitability is under strain because of ballooning bad loans and sluggish credit growth.
6. Over 20 Lakh Businesses Due to File Final GST Returns In 6 Days
As the deadline for filing final returns for the first month of the Goods and Services Tax nears, the Sushil Modi-led Group of Ministers has asked the information technology backbone provider GSTN to send reminder text messages to 20 lakh businesses which are yet to submit the tax forms.
In its second meeting, the Group of Ministers asked the GST Network to brace for the rush of last-minute filers.
The last date for filing of final sales returns for July in GSTR-1 form is 10 October, while the date for uploading of purchase returns in GSTR-2 is 31 October. The final GSTR-3, matching GSTR-1 and 2, is to be filed by 10 November.
7. Printing of New Rs 100 Notes to Begin in April
The Reserve Bank of India (RBI) is expected to start printing new Rs 100 notes around April next year, two central bank officials said. Printing of the notes will begin after the central bank’s printing presses are done with new Rs 200 notes by March.
The existing Rs 100 notes will be withdrawn gradually without any disruption, a government official said, requesting anonymity. The size and dimensions of the new Rs 100 notes will be similar to the old notes so that automatic-teller machines (ATMs) can dispense the new notes without any alterations to the ATMs. Of the four cassettes, or boxes, in an ATM, only one is used for Rs 100 notes.
8. With Banking, Retail in Doldrums, Indian IT to Post Muted Q2 Results
Indian IT companies are likely to report another quarter of muted results, with Infosys widely expected to cut its full-year guidance, as clients in retail and banking and financial services continue to curtail their IT spends.
Muted growth is now a familiar story for the sector, which is struggling with structural changes to the way it does business and is being battered by protectionist moves in its major markets.
“Organic constant currency growth for tier 1 IT will be weak, in the range of 0.9-2.3% quarter-over-quarter. The banking vertical has been weak for many and structural challenges in retail will hamper growth,” Kawaljeet Saluja, analyst at Kotak Institutional Equities, said in a note.
9. M&M Matches Tata Motors’ Bid In Government Contract To Supply Electric Vehicles
Mahindra & Mahindra Ltd on Wednesday matched Tata Motors Ltd’s bid in the first phase of a government contract to supply 10,000 electric vehicles.
M&M qualified after it agreed to match the lowest bid price offered by the Tata Group company for 150 of the 500 vehicles that will be delivered in the first phase, Saurabh Kumar, managing director of Energy Efficiency Services Ltd told BloombergQuint. The remaining 350 vehicles will be supplied by Tata Motors.
Tata Motors and M&M had emerged as the lowest and second lowest bidders respectively in the first phase. The Mahindra Group company will have the option to supply up to 40 percent of future orders if it agreed to match the price quoted by Tata Motors, Kumar added.
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