Banking Awareness of 12, 13 and 14 December 2023

Topic: MoUs/Agreements

1. India and ADB has signed $200 million loan agreement.

• This loan agreement is to improve the quality, efficiency, and reliability of power supply in Uttarakhand.
• This loan agreement is for the Uttarakhand Climate Resilient Power System Development Project.
• Asian Development Bank (ADB) will fund the project. This will strengthen power system infrastructure in Uttarakhand.
• The project involves enhancing of the power system network’s capabilities.
• It also involves upgrading the distribution system to minimize power outages and reduce technical losses.
• The project will modernise Dehradun city’s power network infrastructure.
• The project will involve nongovernmental organizations.
• The Japan Fund for Prosperous and Resilient Asia and the Pacific will provide a $2 million grant to support livelihood enhancement, and training activities of the project.

Topic: Indian Economy/Financial Market

2. Retail inflation increased to three-month high level of 5.55% in November 2023, mostly due to increasing food prices.

• November of the previous year saw retail inflation of 5.88 percent.
• October saw 4.87 percent retail inflation based on the Consumer Price Index (CPI).
• After reaching 6.83 percent in August, inflation has been decreasing.
• According to data from the National Statistical Office, the food basket experienced an 8.7% price increase rate in November 2022 compared to 6.61 percent in October and 4.67 percent in October 2022.
• Inflation in rural areas was higher at 5.85% than price increases in urban areas (5.3%). 
• Urban consumers' food prices increased at a faster rate of 9.3%. 
• The Consumer Price Index (CPI) increased by 0.54% month over month.
• Overall consumer price inflation stood at 5.88% in November 2022.
• Among food items, cereals inflation decreased from 10.7% in October to 10.3% in November.
• Meat and fish inflation declined from 3.3% to 2.15% in November.
• Pulses saw a price jump of 20.23%, up from 18.8% in October, while vegetables saw a price increase of 17.7%, up from 2.7% in October.
• The National Statistical Office calculates inflation rates for 22 major States, and in November, Odisha had the highest rate of 7.65%, followed by Rajasthan at 7% and Haryana at 6.8%.
• The least increase in prices was recorded in Delhi (with 3.1% inflation), Chhatisgarh (3.56%), and the former State of Jammu & Kashmir (3.8%).
• In eight states, the rate of inflation exceeded the central bank's tolerance limit of 6%.
• The only other significant State to see inflation above the 5.55% national average was Uttar Pradesh, with 5.56%.

Topic: Appointments

3. Parama Sen has been appointed by the centre a part-time member in PFRDA.

• Parama Sen is Additional Secretary, Department of Expenditure in the Finance Ministry.
• Anne George Mathew, the Additional Secretary in the Finance Ministry, left her position this year and is replaced by Parama Sen.
• Parama Sen is a 1994 batch Indian Audit and Accounts Services (IAAS) officer.
• The posts of all three part-time member posts in PFRDA board are filled now.
• The two other part-time members are Rahul Singh (Department of Personnel and Training) and Pankaj Sharma (Department of Financial Services). They were appointed last year.
• Pension Fund Regulatory and Development Authority (PFRDA) has a chairman, three whole-time members and three part-time members.
• The position of Member (Law), which became unfilled in May of last year, is still vacant.

Topic: Indian Economy/Financial Market

4. India’s industrial production growth increased to a 16-month high level in October.

• In October, India’s industrial production growth increased to 11.7%.
• India’s industrial production growth had shown a contraction of 4.1% in the same period last year.
• According to the data released by the National Statistical Office (NSO), the output of the manufacturing sector grew by 10.4% in October 2023.
• At the same time, mining production increased by 13.1% during October 2023. Power sector output rose 20.4%.
• The IIP increased by 6.9% in April-October 2023 compared to 5.3% growth a year ago.
• Factory output is measured in terms of the Index of Industrial Production.

Topic: Reports and Indices

5. The weighted average cut-off yield of State Government Security issuances increased to 7.71% as per RBI report.

• RBI report is titled “State Finances: A Study of Budgets of 2023-24”.
• As per the report, the weighted average cut-off yield of State Government Security issuances increased 73 basis points (bps) during 2022-23 from 6.98% in the previous year.
• The weighted average spread (WAS) between SGS issuances and comparable-maturity Central government securities, however, decreased from 41 basis points to 31 basis points in 2022–2023.
• The issuance of 10-year maturity securities formed 27.9% of the total amount of issuances in 2022-23. This was 35.1% in the previous year.
• The remaining 72.1% was distributed over maturities of two to 35 years.
• As of the end of March 2023, 55.1% of the outstanding SGSs were in the residual maturity bucket of five years and above.
• The next ten years will see the maturation of almost 79% of SGS.
• Net market borrowings of states have grown by 5.4% from ₹4.92 lakh crore in 2021-22 to ₹5.19 lakh crore in 2022-23.
• According to the report, this increase was concentrated in states like Andhra Pradesh, Gujarat, Himachal Pradesh, Madhya Pradesh, Haryana and Assam.

Topic: Miscellaneous

6. A total of Rs 57 lakh crore will be spent by India in the next seven years on climate change adaptation.

• India has told the United Nations Climate Change Framework that India has spent more than 5.5% of its GDP, i.e. about Rs 13 lakh 35 crores, on climate adaptation during the financial year 2021-22.
• India has also informed that for this purpose, about Rs 57 lakh crore will be spent in the next seven years so that the situation of climate change can be prevented from becoming more adverse.
• On December 9, it filed India's latest submission which includes the first assessment of adaptation needs.
• Climate-induced damage could increase this amount by another Rs 15.5 lakh crore.
• Climate adaptation efforts are made to reduce the effects of climate change. Its objective is to reduce greenhouse gas emissions.
• Under the Global Climate Change Framework, every country makes an annual assessment of its green gas emissions and provides information to the United Nations.
• These were called National Communications (NATCOMs) under the Kyoto Protocol mechanism of 1997.
• On 9 December, India presented its third NATCOM which will fulfill its obligations under the Kyoto Protocol.
• On 11 December 1997, the Kyoto Protocol was adopted in Kyoto, Japan, and entered into force on 16 February 2005.
• The Kyoto Protocol implemented the UNFCCC's objective to reduce the onset of global warming by reducing greenhouse gas concentrations in the atmosphere.

Topic: Reports and Indices

7. 1st Delta Ranking of Aspirational Blocks Programme (ABP) released by NITI Aayog on 7 December.

• In the first delta ranking of the ABP, Tiriyani Kumuram Bheem block of Asifabad, Telangana has been ranked first.
• The second place was given to Kaushambi block of Kaushambi district of Uttar Pradesh.
• NITI Aayog announced the rankings at a virtual event, which saw participation from over 329 aspirational districts and 500 aspirational blocks from across the country.
• The ranking of the blocks was calculated based on the performance of the blocks and the progress achieved in the Key Performance Indicators (KPIs) in the month of June 2023.
• This is the first time that a ranking of blocks has been calculated as part of the Aspirational Block Programme.
• Apart from ABP, Aspirational Districts Programme rankings for the month of October 2023 were also announced in which Rayagada (Odisha) and Jamui (Bihar) secured the first and second ranks respectively.
• Aspirational Block Program (ABP) was launched on January 7, 2023.
• ABP focuses on improving governance to enhance the quality of life of citizens in India's most difficult and relatively underdeveloped blocks.
• In consultation with various stakeholders, 40 Key Performance Indicators (KPIs) were selected to measure the progress of the Block, grouped into 5 themes.
• The baseline data for the first quarter of March 31, 2023, and June 30, 2023, of 500 aspirational blocks was obtained through the management information system of 11 ministries.
• The first delta rank is calculated based on the improvement in the first quarter.

Topic: Banking System

8. SBI signed 70 million euro (approximately Rs 630 crore) Line of Credit (LoC) with KfW.

• The LoC with German Development Bank KfW is for promoting solar project in the country.
• The agreement has been signed on 14 December at the bank’s IFSC Gift City Branch in Ahmedabad.
• The aim of LoC is to support Solar Photovoltaics (PV) projects in India.
• SBI has shown a 9.13% growth in consolidated net profit for the September quarter.
• It reported a total income of more than Rs 1.12 lakh crore for September quarter.
• State Bank of India (SBI):
  • It is a nationalized public sector bank.
  • The current SBI was founded on 01 July 1955.
  • Its headquarters is in Mumbai, Maharashtra.
  • Dinesh Kumar Khara is its chairperson.

Topic: Banking System

9. Bank of India launched the 'Nari Shakti Savings Account'.

• It has been launched with personal accident insurance cover.
• It caters to women aged 18 and above with an independent source of income.
• It also offers discounted health insurance and wellness products, and rebates on locker facilities for gold and diamond account holders.
• In addition, it offers a concessional rate of interest on retail loans, and a waiver of processing charges on retail loans.
• It also offers free issuance of credit cards, and a higher usage limit of up to ₹5 lakh on Point of Sale (PoS).
• For each New Nari Shakti Account opened, the bank will make a contribution of ₹10/- towards the Corporate Social Responsibility (CSR) fund.
• Bank of India:
  • It is an Indian public sector bank. It was founded in 1906. Rajneesh Karnatak is its MD and CEO.
  • It is headquartered in Mumbai, Maharashtra. Its tagline is Relationship Beyond Banking.

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