Banking, Financial and Economic Awareness of 11 and 12 August 2020

1. Validity of recycling units in three SEZs extended

• Centre has extended validity of 47 listed plastic and recycling units in three SEZs by one month till September 30, 2020.
• The names of three SEZs are Kandla (Gujarat), Falta (Kolkata) and Noida (Uttar Pradesh).
• On 31 May, 2020, three month extension was given to recycling units and now Board of Approval for SEZs has given one month extension.
• In March 2019, import of solid plastics waste in SEZs and Export Oriented Units (EoUs) was banned by Ministry of Environment and Forest (MoEF).
• Earlier, a Committee on plastic waste recycling and worn and used clothing had been formed by Board of Approval (BoA).
• All stakeholder departments, including Directorate General of Export Promotion under the Central Board of Indirect Taxes and Customs are considering recommendations of the committee.
• Special Economic Zone (SEZ):
  • SEZ concept was introduced in the export-import policy of 2000.
  • The main aim of the SEZ concept is to attract Foreign Direct Investment (FDI).
  • The government has notified 351 SEZs till now. Out of these, only 234 are currently operational.

2. RBI grants in-principle approval to South Indian Bank

• RBI has granted in-principle approval to South Indian Bank (SIB) to establish non-financial subsidiary.
• As per the RBI’s approval, the subsidiary will be wholly owned by South Indian Bank (SIB).
• However, SIB still needs to complete formalities and get final approval from regulators.
• The setting up of subsidiary will help bank in streamlining its operations.
• South Indian Bank (SIB):
  • It is a private sector bank.
  • It is headquartered in Thrissur, Kerala.
  • Its CEO is V G Mathew.

3. Terms and conditions for issuance of NCDs worth Rs86 crore approved by CreditAccess Grameen

• Terms and conditions for issuance of NCDs worth Rs86 crore in favour of two banks has been approved by CreditAccess Grameen.
• The names of the banks are Union Bank of India and Bank of Maharashtra. The face value of NCDs is Rs 10 lakh and their tenure is 18 months.
• Government of India will guarantee the NCDs as per the Extended Partial Credit Guarantee Scheme.
• CreditAccess Grameen is registered with RBI as a non-banking finance company-microfinance institution.
• Non-Convertible Debentures (NCDs):
  • They are financial instruments that are not convertible into shares or equities.
  • They are used for raising long-term funds.
  • In comparison to convertible debentures, NCDs provide higher returns.
  • In India, NCDs have a minimum maturity period of 90 days.

4. Covid Healthcare Professionals (CHP) initiative, a unique initiative of ECHO India and Naukri.com

• On 10 August, ECHO India and Naukri.com have launched a unique initiative, named as Covid Healthcare Professionals (CHP) initiative.
• The initiative involves deployment of trained healthcare professionals at healthcare facilities that lack skilled professionals to tackle challenges due to COVID-19.
• The vision of ECHO India and Naukri.com is to register 10,000 professionals at the portal.
• While ECHO India is not-for-profit organization, Naukri.com is a recruitment platform founded in 1997. ECHO India works for capacity building in healthcare sector.

5. A major part of Chennai-Andaman undersea cable project completed by NEC Technologies

• A major part of Chennai-Andaman undersea cable project has been completed by NEC Technologies and the project was inaugurated by PM on 10 August, 2020.
• The project is 2,312-kilometer-long and connects Chennai and seven islands of the Andaman and Nicobar Islands.
• The project will provide high speed broadband connectivity to Andaman and Nicobar Islands.  
• NEC Technologies India is a part of Japanese multinational information technology and electronics company, NEC Corporation (earlier named as Nippon Electric Company).
• Andaman and Nicobar Islands is an archipelago and Union Territory of India. Andaman is separated from Nicobar by 10^o channel. The capital and the largest city of Andaman and Nicobar is Port Blair.

6. NIP online dashboard inaugurated by Finance Minister

• National Infrastructure Pipeline (NIP) online dashboard has been inaugurated by Finance Minister.
• The NIP online dashboard is one stop solution for providing all stakeholders information on infrastructure projects in India.
• The NIP online dashboard is being operated through India Investment Grid (IIG). It is a step towards increasing infrastructure development in the country. 
• In 2019-20 budget speech, government has announced that it will spend 100 lakh crore rupees for infrastructure projects during next 5 years.
• India Investment Grid (IIG):
  • It is an initiative of Department for Promotion of Industry & Internal Trade (DPIIT) and Invest India, which is National Investment Promotion and Facilitation Agency.
  • IIG was launched in September-October 2018. It shows investment options across India on an online platform.

7. Foreign investors in domestic AIFs operating in IFSC exempted from obtaining PAN

• Foreign investors in domestic AIFs operating in International Financial Services Centre (IFSC) have been exempted from obtaining PAN by Income Tax department.
• The exemption will be given only if AIF has deducted fund from the income of foreign investors. The exemption will bring in higher investment capital.
• CBDT has added new rule 114AAB. It notifies classes of persons to whom Section 139A of Income Tax Act will not apply. Section 139A of Income Tax Act provides conditions in which obtaining a PAN is mandatory.
• Alternative Investment Fund (AIF) is a fund that has following defining features.
  • It is established or incorporated in India.
  • It is a privately pooled fund and collects fund from Indian or foreign investors.
• Categories of Alternative Investment Funds (AIFs): AIFs are divided into three categories given below.

1. Category I AIFs:  They make investment in start-ups, small and medium-sized enterprises and venture capital.
2. Category II AIFs:  They include private equity funds and real estate funds.
3. Category III AIFs: They include hedge funds.

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