[Current] Sep-2016: Economy, Banking, Finance: MPC Members, SBI Merger & Share Swapping, Stock Gaming, PFMS, Talgo Rails & Hyperloop Train

1. Governor Dr. Urjit Patel (can give tie-breaker vote)
2. Dy. Governor R.Gandhi
3. Executive Director Michael Patra

1. Chetan Ghate- Professor @Indian statistical inst.
2. Pami Dua- Director @Delhi school of economics
3. Ravindra H. Dholakia-  Professor @IIM-A’bad.

• Governor Urjit Patel replaced Raghuram Rajan. (August 2016)
• Dy. Governor R.Gandhi will hold the monetary policy department (earlier under ex-Dy.Gov Urjit Patel).
• Ex-governor Rajan to teach corporate governance as professor in Chicago booth university.

• Mechanism to deepen Corporate Bonds market.
• Foreign investors can directly participate in bond-market without broker.
• Banks permitted to issue rupee denominated overseas bonds.
• Need to give bond access to low-credit borrowers.

• Executive director of RBI
• This RBI group will review commodity hedging guidelines.

• body constituted under Insolvency and Bankruptcy code 2016
• Madhusudan Sahoo becomes chairman. He’s also a member of the CCI.
• To understand NPA and Bankruptcy code, watch lecture

• Ajay Tyagi (Addl. Secy in Finmin) committee was setup to prepare draft code on resolution of financial firms.
• It has recommended abolishing DICGC and creating a Resolution corporation- to address the solvency issues of financial firms.
• SARFAESI act and Bankruptcy code 2016- deals with non-financial type firms.

• S4A: RBI’s new guideline to help lenders recover bad loans. S4A aims to address the lacunas in earlier 5:25 and SDR scheme.
• RBI also issued draft guidelines for corporate lending. They’re technically designed in a way, that banks will be nudged to give attention to retail loans as well.

• State Bank of Bikaner & Jaipur (SBBJ)

• 28 shares of Rs. 1 each
• In other words, swap ratio is 2.8:1

• Lowest manpower among the merged banks (10650)
• Lowest no. of branches (1037)

• 10 shares
• In other words, swap ratio is 2.2:1

• 10 shares
• In other words, swap ratio is 2.2:1

• Unlisted company
• SBI itself holds ~99%

• State Bank of Hyderabad (SBH)
• Highest manpower (18,842)
• Maximum branches (1933)

• Unlisted company
• SBI itself holds ~99%

• Chief UK Singha got appointed in 2011 for 3 years + 2 years extension. Term to end on 1st March 2017
• Hunt begins to select new chief, he’ll get 4.5 lakh per month package as per the recommendation of Justice AK Mathur’s 7th Pay Commission.
• SEBI chief applications are filtered by the financial sector regulatory appointments search committee headed by Cabinet secretary (IAS).

• To deepen corporate bond market- FPI directly invest without a broker
• ReITs and InvITs also fine-tuned for similar purpose.

• IRB Infra. Developers ltd. Launched first InvIT fund.
• Similar to mutual funds- money pooled from investors and put into finished and revenue generating infra. Projects.
• Unit holders get returns depending on their quantum of investment.

• Got approval from SEBI to launch IPO.
• This is first IPO by an Indian insurance firm
• Got oversubscribed 10x times.

• 60  years completed on 1st September 2016., 22 lakh cr. Rs. Under management; 10 lakh + agents, 2048 branches.
• SK Roy becomes first chairman of LIC to resign before completion of his term. MD VK Sharma became the new chairman.

• Following are the fund managers of NPS
  • ICICI prudential
  • HDFC
  • Kotak-Mahindra
  • Reliance cap
  • Birla Sunlife
  • LIC
  • SBI
  • UTI

Last three responsible for managing Government sector NPS. In news because now PFRDA invited fresh bits to manage NPS funds- total 10 will be given ‘license.’

• Industrial finance corporation of India (IFCI)- accused of financing Satyam- a willful default declared by RBI.
• So, SC orders RBI, SEBI and SFIO to probe against IFCI.

• To reduce the number of ‘zero-balance’ Jan Dhan account, the Bank staff itself adding one rupee in such accounts of poor people by diverting the money meant for office/canteen expenditure. Account holders themselves unaware.
• Financial inclusion alone not sufficient, without generation of jobs / incomes. This data-dressing tends to hide this problem.

• Sites such as “stockrace.in”,  allow lottery type of games linked with performance of BSE-NSE, where real money and physical prizes are given.
• Experts criticize this as one type of ‘betting/gambling’. But SEBI helpless. Matter falls in State government domain. Assam-Odisha laws have forbidden them.

• Allegations that big brokers are using algo-trading (using computer algorithm to put large scale orders) and they’ve installed such system within NSE building to get faster access to portal compared to ordinary share investors accessing through (*insert name of your most hated mobile company*) ki bogus 3G/4G service.
• Meaning, Big brokers can place orders faster than ordinary investors. thus giving possibility to price manipulation and stock-rigging.
• So, NSE orders probe.

• ~65,000 people declared black money worth Rs.65,000 crores.
• In the earlier scheme of 1997- amnesty was given, but this 2016 scheme involves penalty of 45% on black money so,  it can’t be called “amnesty scheme.”
• More insights in future lecture.

• RIL should compensate ONGC for the KG-D6 block for past 7 years because RIL was gas from ONGC’s block was migrating to Reliance’s block in the Krishna Godavari basin.
• Government order DG-hydrocarbon to work out the penalty formula on reliance.

• Pulse production- how to improve using MSP and related policies.
• Recommendations- will discuss in the lecture.

• Finmin setup this committee to suggest ways to promote e-payments via giving ta-x rebates, cash back, lottery etc.
• Ratan Watal is ex-finance secretary.

• He is secretary (IAS) in Union highway ministry.
• This committee will look into issues related to taxi-operators including surge pricing by taxi-app companies and taxi-permits.

• For unskilled non-agro worker, the minimum wages have been hiked from 246 to Rs.350 per day.  But trade union demand Rs.18,000 per month. Hence planning to go on strike.

• Government brining bill to raise MP’s emoluments to Rs.2.8 lakhs per month.

• American solar companies had challenged India’s JNSolar mission under which desi solar panels were given first preference in public procurement.
• WTO ruled in favour of USA.
• India went to WTO-appellate body but they also ruled in favour of USA.

• Traditionally,  World bank chief chosen by USA and IMF chief by Europe.
• Jim Yong Kim’s first five year tenure ends on June 2017. he’s given 2nd term. (although staff had opposed)

• After fixing CGT exemption from Mauritius DTAA, now government doing same with Cyprus. No more CGT exemption from April 2017.

• Bank for international settlement (BIS) says Banks in china are to face crisis in next 3 years because they’re unwittingly giving too much loans to home buyers and real-estate developers.
• But some experts say just because American banks burned hands in Sub-prime lending doesn’t mean history shall repeat in China.

• Receives 47,000 crore FDI infusion from parent company to compete after Reliance-4g offer!
• This is the biggest FDI infusion in Indian history.

• Third round – 27 cities from 12 states selected
• Total count is – 60 x each to get 200 crores from union.

• CAG tells PAC that PPP projects get money from Consolidated fund, hence should be audited by CAG. PAC forms a subpanel to examine how to do it in systematic manner.

• Talgo is a Spanish company specializing in high speed railways.
• It has given a trial train to India – claiming to run at 200 kmph.
• Desi trains use Linke Hoffman Busch (LHB) coaches- their wheels are joined by axle underneath
• While in Talgo coaches,  each wheel is fitted individually.

• Rail ministry launches insurance scheme for travelers: children below 5 and foreign citizen not covered.
• 10 lakh for death/total disability + 10k for transporting dead body.
• Upto 2 lakh for hospitalization, robbery, dacoity, arson etc.

• Swatchh Bharat Sarvekshan (Survey) 2016 by Drinking water and Saniation  ministry, with help of NSSO data.
• Best state in rural sanitation is Sikkim. Most Bogus is UP.

• international  collaboration on global burden of disease (GBD) has analysed each country’s progress to SDG goals.
• Their 1st health index released @UNGA.
• Total 100 marks, Best country Iceland (85),  most bogus Is Central African Republic.
• India ranks 143/188 countries,  we spend hardly 1% of GDP on healthcare.

• First Incredible India tourism investors summit held at New Delhi. It was organized by tourism ministry.

• National summit on innovation and technology- held at Gandhinagar, Gujarat.