1. Rs 12.75 lakh crore penalty has been imposed by RBI on eight cooperative banks.
- The penalty has been imposed for deficiencies in regulatory compliance.
- The names of cooperative banks on which penalty has been imposed are listed below.
- Rs 4 lakh penalty on Nabapalli Cooperative Bank.
- Rs 3 lakh penalty on Baghat Urban Cooperative Bank.
- Rs 2 lakh penalty on Manipur Women's Cooperative Bank.
- Rs 1 lakh penalty on United India Cooperative Bank.
- Rs 1 lakh penalty on Jila Sahakari Kendriya Bank.
- Rs 50,000 penalty on Amravati Merchants’ Cooperative Bank.
- Rs 25,000 penalty on Faiz Mercantile Cooperative Bank.
- Rs 1 lakh penalty on Navnirman Cooperative Bank.
Topic: Banking System
2. RBI has removed ban on HDFC Bank’s business generating activities planned under Digital 2.0 programme.
- In December 2020, RBI has said HDFC Bank was not allowed to launch new digital products or services.
- RBI has also banned HDFC Bank from issuing new credit cards after outages in its mobile and internet banking services.
- Then, an external IT firm was appointed by RBI in February 2021 for carrying out a special audit of the IT infrastructure of HDFC Bank.
- HDFC Bank is headquartered in Mumbai. It is India’s largest private sector bank. It was founded in 1994. CEO of HDFC Bank is Sashidhar Jagdishan.
3. RBI has released harmonized framework for microfinance lenders.
- Reserve Bank of India (Regulatory Framework for Microfinance Loans) Directions, 2022, will come into effect from April 1, 2022.
- RBI said all collateral-free loans provided to households having an annual income of up to Rs 3 lakh will be considered microfinance loans.
- Previously, the income limits were set at 2.5 lakh in rural regions and 2 lakh in other areas.
- As per RBI, margin caps will no longer be applied to non-banking finance company-microfinance institutions (NBFC-MFIs) pricing.
- In other words, RBI has removed caps on the pricing of small loans given by NBFC-MFIs.
- All microfinance lenders must now implement a board-approved loan pricing policy.
- RBI has also raised the maximum limit on microfinance loans given by NBFCs that are not qualified as NBFC-MFIs from 10% earlier to 25%.
- For NBFC-MFIs, RBI has also reduced the minimum loan requirement of microfinance loans of total loan assets from 85% to 75%.
- There would be no prepayment penalty on microfinance loans. Maximum repayment value has been limited to 50% of monthly household income.
4. N Chandrasekaran has been appointed as chairman of Air India.
- He is chairman of Tata Sons. The appointment of Alice GeeVarghese Vaidyan as an independent director on Air India’s board has also been approved.
- Mehmet Ilker Ayci has earlier declined the offer to be CEO of Air India.
- Air India was officially handed over to Tata Sons in January 2022.
- It was sold for Rs 18,000 crore along with its low cost carrier Air India Express and 50% of AISATS, a ground handling company.
Topic: Indian Economy/Financial Market
5. India’s goods exports in February 2022 have increased by 25% to $34.57 billion.
- In February 2022, good imports increased by 36.07% to $55.45 billion.
- As a result, the trade deficit for February 2022 increased to $20.88 billion. This was 59% higher than in February 2021.
- Petroleum imports increased 69 % to $15.28 billion. Gold imports declined 9.65 % to $4.8 billion.
- Goods exports for April-February 2021-22 were 46.09% higher at $374.81 billion.
- Goods imports for April-February 2021-22 were 59.33% higher at $550.56 billion. Trade deficit for same period doubled to $175.75 billion.
6. India is likely to achieve self-sufficiency in urea.
- India’s urea production is expected to increase to 31.8 million tonne as against 24 million tonne (mt) in 2018-19.
- India’s urea demand/consumption is around 33 mt. Urea production will exceed 34 mt when the urea plant at Talcher (Odisha) and another at Namrup (Assam) will be commissioned.
- Gorakhpur plant (Uttar Pradesh) will soon start producing a full capacity of 1.27 mt per annum.
- Ramagundam plant (Telangana) may be operational to full capacity around June.
7. EPFO’s CBT has recommended reduction in interest on provident fund deposits from 8.5% to 8.1% for 2021-22.
- This is the lowest interest rate since 1977-78. In 1977-78, EPF interest rate was at 8%.
- The lowest rate of 8.1% has been recommended by EPFO’s Central Board of Trustees (CBT), chaired by Labour and Employment Minister Bhupender Yadav.
- The rate must be ratified by the Finance Ministry before it is notified and credited to members’ accounts.
- The Minister said that EPFO Board will meet every three–four months and the next meeting will be in June or July in Bengaluru.
- In March 2021, Central Board of Trustees (CBT) has decided 8.5% interest rate on EPF deposits for 2020-21.
- It was approved by the Finance Ministry in October 2021.
- EPF accounts are mandatory for employees earning up to ₹15,000 a month in firms with over 20 workers.
- 12% of the basic pay and dearness allowance is deducted as employees’ contribution and another 12% is remitted by the employer.
- Central Board of Trustees (CBT) is the apex decision-making body of EPFO.
- EPFO is India’s largest retirement fund and the second largest non–banking financial institution.
Topic: Indian Economy/Financial Market
8. As per the PLFS of April-June 2021, urban unemployment rate is rising in India.
- 12.7 persons out of 100 in labour force are unemployed according to Periodic Labour Force Survey (PLFS) of April-June 2021.
- As per PLFS report, the unemployment rate among labour force between 15-29 years is 25.5.
- It was 22.9 in the last quarter. It was 34.7 in corresponding quarter of 2020.
- Unemployment rate among women in the age group 15-29 years is 31 and among the men, it is 24.
- Unemployment rate among all ages is 12.7 during April-June 2021 period.
- Unemployment rate among women of all ages is 14.3 and men of all ages is 12.2.
- Urban unemployment rate for persons of all ages is highest in Kerala (24.4) followed by Chhattisgarh (19.2). Gujarat has the lowest (5.5).
- LFPR in the population of all ages is 37.1. WPR was 32.4.
- Labour Force Participation Rate (LFPR) is the percentage of persons in labour force (working or seeking or available for work).
- Worker Population Ratio (WPR) is the percentage of employed persons in the population of all ages.
Topic: Indian Economy/Financial market
9. India’s WPI inflation increased to 13.11% in February 2022 as per data from the Ministry of Commerce & Industry.
- Wholesale Price Index (WPI) increased to 12.96% during January 2022 and it increased to 14.27% in December 2021.
- Wholesale Price Index (WPI) in February 2021 was at 4.83%.
- Since April 2021, WPI inflation has remained in double digits for the 11th month in a row.
- India’s retail inflation increased to 6.07% in February 2022 as per data released by the Ministry of Statistics & Programme Implementation (MoSPI).
- The retail inflation measured by CPI was 6.01% for January 2022.
- This is the second consecutive time that CPI data has reached beyond RBI’s upper limit of 6%.
- Consumer Food Price Index (CFPI) or the inflation in the food basket also increased in February 2022 to 5.85%, from 5.43% in January 2022.
- Finance ministry said that despite the rise in global crude oil prices, retail prices of diesel and petrol have not been revised since November 2021.