Banking Awareness of 20, 21 and 22 February 2024

Topic: Indian Economy/Financial Market

1. According to Jefferies, the Indian stock market might reach $10 trillion by 2030.

• Over the following ten years, global financial advising firm Jefferies is increasingly optimistic about India's future.
• As per Jefferies forecast, India will be the third-largest economy by 2027.
• India's GDP grew at a CAGR of 7% during the last ten years to reach $3.6 trillion, moving it up from the eighth to the fifth largest economy in the world.
• It predicted that India's GDP will likely reach $5 trillion during the following four years.
• Even though India has the fifth-largest market capitalization in the world right now ($4.5 trillion). Its 1.6% weight in global indexes is still quite small (10th rank).
• India's industry is expected to grow to around $10 trillion by 2030.

Topic: Summits/Conferences/Meetings

2. World Trade Center’s Association (WTCA) Global Business Forum 2024 will be organised in Bengaluru from March 3-6.

• India’s agri and food processing and biotechnology sectors will be among the main focus areas for investors at this forum.
• The 2024 Global Business Forum (GBF) is making its debut in India.
• It is being hosted by the WTCA and World Trade Center Bengaluru.
• It will be a four day event that will highlight India as an investment destination.
• It is anticipated that more than 100 Indian businesses will take part in GBF 2024.
• GBF 2024 will highlight investment prospects across 12 diverse Indian industry sectors.
• “EPIC: Empowering Progress through Innovation & Collaboration,” is the theme of the event.
• WTCA is an international trade organization. It links over 300 World Trade Center locations in nearly 100 countries.

Topic: Reports and Indices

3. India's overall financial conditions tightened in January compared to December, according to CRISIL's FCI.

• CRISIL's Financial Conditions Index (FCI) decreased from 0.7 in December to 0.5 in January.
• According to CRISIL's report, there was a greater shortfall of liquidity, which resulted in higher short-term rates.
• It further stated that the conversion of foreign portfolio investors (FPIs) into net-sellers has an impact on the state of the financial system.
• In January, the transmission of interest rate hikes across lending and deposit rates improved as liquidity contracted.
• The average increase of lending and deposit rates, however, has not increased by as much as the 250 basis point increments implemented by the RBI since May 2022.
• The increase in lending and deposit rates has not had a significant impact on the growth of bank credit overall.
• The RBI decided to maintain interest rates at their current levels due to incomplete monetary policy transmission.
• Compared to December, the shortfall in domestic systemic liquidity nearly doubled in January. Since September, there has been a decrease in liquidity.
• As a result, the RBI used the liquidity adjustment facility (LAF) to infuse a net of Rs 2.07 lakh crore (1.0% of NDTL), as opposed to Rs 1.14 lakh crore (0.5% of NDTL) in December.
• The CRISIL report stated that the lack of systemic liquidity was pushing money market rates downward.
• For the last three months, the call money rate has stayed above 6.75 percent, signaling a lack of liquidity in the banking system.
• In January, rates on other money markets increased more sharply.
• The rates for both the six-month certificate of deposit (CD) and commercial paper (CP) have increased sharply on-month by 18 bps and 10 bps, respectively.

Topic: Appointments

4. M R Kumar has been appointed as part time non official Director and non-executive Chairman of Bank of India (BOI).

• He has been appointed for the post in Bank of India for a term of three years. He is former LIC Chairman.
• Srinivasan Sridhar has been appointed as part time non official Director and non-executive Chairman on the Board of Indian Overseas Bank (IOB).
• Sridhar has been appointed for a term of three years. His appointment is subject to the condition that he resigns from the Board of Bank of Baroda.
• Aravamudan Krishna Kumar has been appointed as part time non official Director and non-executive Chairman on the Board of UCO Bank.   
• He has been appointed for a period of three years. His appointment is subject to his resignation from the Board of Suraksha Asset Reconstruction Limited.

Topic: Indian Economy/Financial Market

5. Government has permitted 100% FDI in space sector.

• An amendment to the Foreign Direct Investment (FDI) policy that permits 100% foreign investment in the space sector has been approved by the Center. 
• Following the Union Cabinet meeting, Minister Anurag Singh Thakur said, the liberalized entry routes under the modified policy are aimed to attract potential investors to invest in Indian space companies.
• The manufacturing of components and systems or sub-systems for satellites, ground segments, and user segments will be permitted to have FDI up to 100% under the Automatic route.
• The satellites subsector has now been split up into three distinct activity areas, each of which has set limits on foreign investment.
• The following are the entry routes for the different activities covered by the updated policy:
  • Upto 74% under Automatic route: Satellites-Manufacturing & Operation, Satellite Data Products and Ground Segment & User Segment. Beyond 74% these activities are under government route.
  • Upto 49% under Automatic route: Launch Vehicles and associated systems or subsystems, Creation of Spaceports for launching and receiving Spacecraft. Beyond 49% these activities are under government route.
  • Upto 100% under Automatic route: Manufacturing of components and systems/ sub-systems for satellites, ground segment and user segment.

Topic: MoUs/Agreements

6. IREDA and Punjab National Bank signed a MoU to Co-Finance Renewable Energy Projects.

• Indian Renewable Energy Development Agency Ltd. (IREDA) and Punjab National Bank (PNB) have joined hands in financing renewable energy initiatives.
• The agreement has been signed at IREDA's registered office in New Delhi.
• The MoU comprises various provisions aimed at enhancing support for renewable energy projects.
• It includes joint lending, loan syndication and underwriting, and management of Trust and Retention Account (TRA) for IREDA borrowers.
• The MoU is mainly focused on lending and loan syndication for a wide range of Renewable Energy projects.
• IREDA and PNB can also invest in bonds issued by either organization.

Topic: Reports and Indices

7. India steps down to 85th place in the world's most powerful passports ranking.

• France secured the top spot in The Henley Passport Index for 2024.
• Whereas India's passport ranking has slipped one place compared to last year, from 84th to 85th.
• The Henley Passport Index ranked countries based on the strength of their passports.
• France is leading the list in 2024, with its passport offering visa-free access to 194 countries.
• Along with France, Germany, Italy, Japan, Singapore, and Spain are also among the top-ranked countries.
• Pakistan remains at 106th position like 2023, while Bangladesh has slipped from 101st to 102nd.
• Henley Passport Index:
  • It was launched in 2006. The index covers 199 passports and 227 travel destinations.
  • It is based on the data collected from the International Air Transport Association (IATA).
  • The Index's scoring system was developed to give users a nuanced, practical, and reliable overview of the power of their passport.
  • Each passport is scored on the total number of destinations the holder can access visa-free.

Topic: Miscellaneous

8. Union Minister Dharmendra Pradhan inaugurated India’s first Skill India Centre in Sambalpur, Odisha.

• This Skill India Center will empower youth with industry-relevant skills.
• Union Minister Dharmendra Pradhan mentioned that introducing low-cost courses at the centre would empower many young people.
• Around 1200 students will upgrade their skill set to align with the demands of industries.
• Skill India Centre will offer a blend of classroom and work-based learning. It will nurture young talents to meet industry demands.
• This centre will equip young Indians with contemporary skills essential for the evolving job market.
• The National Skill Development Corporation (NSDC) will be designated as the center manager to monitor the implementation of training programs.
• It will also oversee the overall functioning of the centre.

Topic: Miscellaneous

9. An investment of Rs 12,800 crore will be made by Japan for 9 projects in various sectors in India.

• On 20 February, the finance ministry said that the Japanese government has committed a loan of 232.209 billion yen (about Rs 12,800 crore) for nine projects related to various sectors in India.
• Vikas Sheel, Additional Secretary, Department of Economic Affairs, and Suzuki Hiroshi, Ambassador of Japan to India, signed the agreement.
• The projects include North East Road Network Connectivity, Project for Promoting Start-up and Innovation in Telangana, and Project for the Construction of Chennai Peripheral Ring Road.
• This also includes the Project for Promoting Sustainable Horticulture in Haryana and the Project for Climate Change Response and Ecosystem Services Enhancement in Rajasthan.
• The aim of the road network connectivity projects is to improve infrastructure development in the north-east region of India.
• The aim of the Chennai Peripheral Ring Road project is to reduce traffic congestion and strengthen connections to the southern part of the state.
• By developing a medical college hospital contributing towards universal health coverage, the project in Nagaland will help develop tertiary-level medical service delivery.
• In Telangana, a unique project will help in exploring entrepreneurial skills and supporting the business expansion of MSMEs with a focus on women and the rural population.
• Since 1958, India and Japan have had a long and fruitful history of bilateral development cooperation.

Topic: Miscellaneous

10. On 19 February, Malta has become the 119th country to join the International Solar Alliance.

• The ISA is an alliance of over 120 signatory countries that aims to reduce dependence on non-renewable sources of energy, such as fossil fuels.
• On 19 February, Christopher Cutajar, Permanent Secretary of the Maltese Ministry of Foreign Affairs, signed the ISA Framework Agreement.
• The platform seeks to develop and deploy cost-effective and transformative energy solutions powered by the sun to help member countries develop low-carbon development trajectories.
• It has a special focus on making an impact in countries classified as Least Developed Countries (LDCs) and Small Island Developing States (SIDS).
• International Solar Alliance (ISA):
  • International Solar Alliance (ISA) was co-founded by India and France.
  • India and France jointly launched the International Solar Alliance (ISA) on 30 November 2015 at COP21 in Paris, France.
  • Its main objective is to reduce the use of conventional energy by using solar energy efficiently.
  • Ajay Mathur is the current Director-General of International Solar Alliance. Its headquarters is located in Gurugram.

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