Daily Financial News Analysis – 16th Oct’19 | PDF Download

RBI Guv Faces Board Queries on Financial Frauds

  •  Shaktikanta Das came under pressureat the bank’s board meeting last week.
  • 2 external directors questioning howa string of frauds that have surfaced since 2018 remained undetected for years?????
  • These incidents differ from eachother and are not exactly related, but a few members were quite vocal about it.
  •  The governor explained theinformation sharing system and collection of data by the RBI… In some cases, the data itself — even the audited numbers — were either inadequate or fudged.
  •  The external directors raised theissue at a time when the banking regulator is facing flak on social media, and facing the ire of depositors and financial market commentators.

Rev Secy on Tax Target

  • Ajay Bhushan Pandey: government iswell on track to meet its tax targets.
  • Any reduction in personal income taxwould depend on impact of the measures taken on revenue and the budget.
  • Pandey strongly refuted criticism thatthe goods and services tax was the cause of the current economic slowdown.
  •  Asked about rate rationalisation or aslab rejig in GST: what is required is a balanced approach looking at the revenue collection position, the revenue requirement position and the need for rationalisation.

2-year Holiday on Spectrum Payments

  •  Telecom department is working on aplan.
  •  To provide a 2-year holiday onpayment of spectrum dues. Totalling over ₹40,000 crore by thethree private telcos. Any decision will be subject toapproval by the FM.
  • Abhijit Banerjee: India’s economy wasin a “tailspin” and “doing very badly” . The government’s main focus has tobe on reviving demand. “I think demand is a huge problem right now in the economy.”

 Falling MILLET Prices

  • Mandi prices of millets such as ragiand bajra ruling at 15-24% below their minimum support prices (MSPs).
  •  Niti Aayog has recommended that theCentre offer 15-20% of MSP as commission to private traders to encourage them to buy coarse cereals at MSP.
  • This will avoid distress sales byfarmers.
  • If the proposal is implemented, theprivate trade will for the first time play a significant role in public procurement of grains.
  •  Using private agencies is still acheaper option than asking FCI.
  • PM-Aasha scheme
  1. Price support scheme
  2. Price deficiency payment scheme
  3. Private procurement and stockist scheme

Exports shrink

  • Merchandise exports shrank 6.6%year-on-year in September to $26 billion. The 3rd contraction in six months.
  • Reflecting the impact of not justexternal headwinds but also subdued domestic manufacturing.
  • Goods trade deficit hit a 7-month lowof $10.86 billion in September.
  •  Imports plunged by almost 13.9%,mirroring a collapse in domestic consumption.
  •  Exports of 23 out of 30 key itemscontracted, while imports of as many as 25 of the 30 products dropped. Industrial outputGold importsRural distress

IMF on Indian GDP Growth

  • International Monetary Fund: India’sGDP growth projections by 90 bps to 6.1% for FY20 and by 20 bps to 7% for FY21.
  • World Bank had slashed India FY20growth estimate to 6% from its original call of 7.5%.
  • Moody’s Investors Service: cut itsforecast for India’s FY20 GDP growth by 40 bps to 5.8%.


  • Power Minister RK Singh: ‘coal versus renewableenergy’ debate is “based on the wrong premises”
  • The country is working to attain the intendednationally determined contribution (INDC) target of reducing the emissions intensity of its GDP by 33- 35% by 2030 from the 2005 level.
  • Coal Minister Pralhad Joshi: his ministry “isimplementing coal washeries, permitting only super critical coal plants and planting trees for capturing carbon naturally”, to reduce the carbon footprint.

Agri Secy on Oilseeds

  • 10th National Seed Congress
  • To boost domestic production ofoilseeds and cut dependency on import of edible oil.
  • Scientists should develop high-yieldingvarieties of seeds, especially that of soyabean.
  •  Creating the world’s best traceabilitysystem to ensure availability of quality seeds to farmers. ‘Quality Seed for farmers’ Prosperity’
  •  The secretary also talked about theneed to boost seed exports.
  • According to industry data, the overallimports of vegetable oils during November 2018 to September 2019 went up by 3 per cent to 14.17 million tonne.
  •  Agarwal said the government is in theprocess of bringing a new seed law and asked experts to give suggestions.
  • Indian Council of Agricultural Research(ICAR) Director General Tirlochan Mohapatra spoke about DNA barcoding and stressed on developing protocol for DNA profiling.
  •  He said seed production should bebased on demand placed by state governments


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