Banking Awareness of 30 and 31 May 2023

By Priyanka Chaudhary | Last Modified: 03 Jun 2023 18:28 PM IST
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Topic: RBI

1. India’s GDP growth projected at 6.5% for FY24 as per RBI Annual Report.  

  • As per the Annual report of RBI for FY23, India’s growth momentum is likely to be sustained in 2023-24 but domestic economic activity is facing challenges from global outlook.
  • Resilient domestic macroeconomic and financial conditions, expected dividends from past reforms and new growth opportunities from global geo-economics shifts create an advantage for India.
  • The report cautioned that slowing global growth, prolonged geopolitical tensions and a possible rise in financial market volatility followed by new stress events in the global financial system could negatively impact the growth.
  • The report emphasized the need to sustain structural reforms to improve medium term growth potential of India.
  • The cumulative increase in policy repo rate by 250 basis points last year would guide the disinflationary process, along with supply side measures to address transient demand-supply mismatch due to food and energy shocks.
  • The headline inflation is projected to come down to 5.2% in FY23-24 considering stable exchange rate and a normal monsoon.
  • The focus of Monetary policy would remain on withdrawal of accommodation to ensure that inflation aligns with the target while supporting growth.
  • Realignment of global supply chains, transition to green energy and ongoing technological advancements give a suitable environment for pick-up in investment activity and raising productivity.
  • The robust balance sheets of corporates and banks, along with high capacity utilization would help in strengthening the growth in private investment.
  • In external sector, Current Account Deficit (CAD) is expected to remain moderate owing to robust services exports and positive impact of moderation in commodity prices of imports.
  • With the ongoing global uncertainties, FPI flows may remain volatile.
  • Lower inflation, business friendly policy reforms, and favorable domestic growth outlook could help sustain buoyant FDI inflows.
  • Inward remittances are expected to remain robust due to better growth prospects in the gulf nations.
  • As a result, external vulnerability risks may ease further during 2023-24.
  • Indian economy has experienced macroeconomic and financial stability during recurrent global shocks that reflects its sound macroeconomic policy environment and innate resilience.
  • RBI said that India has remained among the fastest growing major economies of the world, contributing more than 12% to the global growth on average during last 5 years.
  • RBI also said that the medium term prospects have been enlightened by the digital revolution, demographic dividend, policy initiatives to transform India to global manufacturing hub, a resurgence in service sector competitiveness and favorable geo-economic positioning.

Topic: RBI

2. As per RBI annual report, there has been 14.4% rise in Rs. 500 fake notes during the year 2022-23. 

  • RBI has recognized 91,110 counterfeit Rs 500 notes worth Rs. 4.55 crore during the year 2022-23. In the year 2021-22, 79,699 counterfeit notes were detected by RBI.
  • During 2022-23, out of total fake Indian Currency notes (FICNs) 4.6% were detected at RBI and 95.4% at other banks.
  • There was 8.4% increase in the counterfeit notes detected in the denominations of Rs 20.
  • The counterfeit notes detected in the denominations of Rs 10, Rs 100 and Rs 2000 declined by 11.6%, 14.7% and 27.9%, respectively.
  • As on March 31, 2023, the share of Rs 500 and Rs 2000 banknotes together accounted for 87.9 % of the total value of banknotes in circulation.
  • In terms of volume, Rs 500 denomination has the highest share at 37.9%, followed by Rs 10 denomination banknotes with 19.2% share of the total banknotes in circulation as on March 31, 2023.
  • Reserve Bank of India launched a pilot project on QCVM – QR Code based vending machine- in association with five banks viz. Axis Bank, Bank of Baroda, ICICI Bank, SBI and Federal Bank to improve coin distribution.
  • QCVM is a cashless coin dispensation system that allows payment transactions through UPI after scanning a dynamic QR code generated by the machine on customer’s mobile phone.

Topic: Indian Economy/Financial Market

3. For the fifth consecutive year, India has become net importer of copper.

  • Copper imports in India has seen a 15% y-o-y jump in FY2022-23.
  • The government’s emphasis on infrastructure along with a strong rebound in economic activities in sectors – real estate to consumer durables and EV manufacturing- have increased the demand for copper.
  • As per Ministry of Commerce’s data, India imported 2,75,341 tonnes of copper in FY2021-22 including both refined and finished copper.
  • Refined copper is the end product where impurities are removed from copper ore.
  • Finished copper is the copper that has been processed and shaped into final form like wires, tubes, pipes, sheets, etc.
  • Copper is used 2-3 times more in EV manufacturing as compared to fuel-based vehicles manufacturing.
  • Post COVID, strong growth has been seen in key sectors like automobile, construction, power, etc, which have increased the demand for copper.
  • However, copper imports in FY23 were still lower than the pre-Covid high of 3,57,423 tonnes recorded in FY20.
  • After aluminium and steel, Copper is the third most used industrial metal.
  • Until FY18, India used to be net exporter of copper. But, in May 2018, government of Tamil Nadu ordered to seal and permanently close Vedanta’s Sterlite copper smelter plant citing pollution concerns.
  • Sterlite copper was catering 40% of the domestic demand in India before its closure.
  • As per International Copper Association India, demand for red metal rose to 12.5-lakh tonnes in FY22 compared to 9.78-lakh tonnes in FY21, which will further go up in FY23.
  • India has set a target to achieve 500 GW renewable energy capacity by 2030. As per estimates, 3000 kg of copper is required to generate 1 MW power via solar and onshore wind platforms.
  • Offshore wind platforms are more copper intensive and would require 8000 kg of copper per MW.
  • India’s copper exports also declined to 61,057 tonnes in FY23 from 1,20,302 tonnes in FY22.
  • Chile is the largest producer of copper in the world, followed by Peru, Congo, USA, Russia, Indonesia, Australia, Zambia, and Mexico.

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Topic: Companies/Corporates

4. JSW Steel granted CII GreenPro Ecolabel.   

  • JSW Steel’s “Automotive Steel” products have received GreenPro ecolabel.
  • Confederation of Indian Industry’s Green Business Centre has developed the GreenPro Ecolabel.
  • The ecolabel recognizes the highest standards of environmental sustainability and product performance in the Indian manufacturing sector.
  • The ecolabel shows that the products of JSW steel are manufactured with utmost care to their environment impact throughout their lifecycle which includes sourcing of raw material, production process, energy consumption and end-of-life management.
  • JSW steel is a leading integrated steel manufacturer. It is based in Mumbai and was founded in 1982. It is India’s second largest private sector steel company.

Topic: Government Schemes and Initiatives

5. Government to extend Atal Bhujal Yojana till 2027.

  • The National Level Steering Committee (NLSC) has decided to extend Atal Bhujal Yojana to additional two years. Its original end year was 2025.
  • The scheme has been extended to make up the implementation delays that occurred due to covid-19 and to further promote community behavioural change initiatives.
  • The NLSC reviewed the progress of the project and urged state officials to accelerate all related activities.
  • This scheme has been lauded by World Bank for its significant role in promoting water use efficiency.
  • Atal Bhujal Yojana brought 450,000 hectares of irrigated area through various water techniques like drip irrigation and crop diversification.
  • Atal Bhujal Yojana:
    • It was launched in 2020. It is being implemented in 80 districts of seven Indian states.
    • The main focus of the scheme is to bring community behavioural change towards conservation and smart water management.
    • The scheme also encourages innovative irrigation techniques to improve water efficiency.
    • Under this scheme, the adoption of various successful practices in different states has been witnessed.
    • It focuses on groundwater recharge and demand-side interventions.
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Topic: Reports and Indices

6. As per PLFS, India’s urban unemployment rate has declined to 6.8% in Q4 of FY23.

  • This is the lowest level in more than four years. It stagnated at 7.2% in the previous October-December quarter.
  • The decline in the rate reflects improvement in the labour market, according to the Periodic Labour Force Survey (PLFS) released by the National Statistical Office (NSO).
  • The unemployment rate in the current weekly status (CWS) terms of all ages in the March quarter was the lowest recorded in over four years.
  • NSO released India’s first quarterly urban unemployment rate for the December quarter in 2018.
  • The unemployment rate in urban areas was at the peak of 20.8% in the April-June quarter of FY21. It had been on a continuous decline since then.
  • The unemployment rate in urban areas for male of age 15 years and above for January – March 2023 was 6%.
  • In the previous (October – December 2022) quarter, it was 6.5%. In April-June quarter of 2020-21, it was estimated at 12.2%.
  • The unemployment rate in urban areas for female of age 15 years and above for January – March 2023 was 9.2%.
  • In the previous (October – December 2022) quarter, it was 9.6%. In April-June quarter of 2020-21, it was estimated at 14.3%.
  • Labour force participation rate (LFPR) marginally increased from 48.2% in Q3FY23 to 48.5% in Q4FY23.
  • LFPR for females increased from 22.3% in Q3 to 22.7% in Q4 and LFPR for males increased from 73.3% in Q3 to 73.5% in Q4.
  • Many women found work in self-employed category, including unpaid helpers in household enterprises. Share of men in regular salaried jobs increased.
  • The worker-to-population ratio (WPR) increased by 0.5 percentage points to 45.2% in Q4.
  • The female WPR was 20.6% and the male WPR was 69.1%.
  • Worker Population Ratio (WPR) is the percentage of employed persons in the population.
  • Labour Force Participation Rate (LFPR) is the percentage of persons in labour force in the population. This includes working or seeking or available for work.
  • Unemployment Rate (UR) is the percentage of persons unemployed among the persons in the labour force.

Topic: Appointments

7. CAG G C Murmu has been re-elected External Auditor of the World Health Organisation for 4 years.

  • His re-election is for a four-year term from 2024 to 2027. The election took place at the 76th World Health Assembly in Geneva.
  • The position was already held by him for four years from 2019 to 2023.
  • After the election, in his address to the World Health Assembly, CAG Murmu emphasised the process improvement for better outcomes, transparency and a professional approach.
  • This is the second major international audit assignment for the CAG this year.
  • He was selected for the post of External Auditor of the International Labour Organisation in March 2023.

Topic: Infrastructure and Energy

8. Government to waive off ISTS charges for Off-Shore Wind Projects.

  • The Government has decided to waive off Inter-State Transmission Charges (ISTS) for Off-Shore Wind Projects.
  • The government has extended the waiver to Green Hydrogen and Green Ammonia.
  • This decision has been taken to promote the expansion of Green Hydrogen and Green Ammonia Projects and to encourage the production of renewable energy from Energy Storage System Projects.
  • Projects commissioned till December 31, 2032, will become eligible for a complete waiver of ISTS charges for 25 years from the date of commissioning.
  • Graded ISTS charges will become applicable to the off-shore projects commissioned from 1st January 2033.
  • The Government was earlier providing waivers to wind energy projects till 30th June 2025.
  • The government has also waived off ISTS charges for 25 years for Green Hydrogen and Green Ammonia production units, which are using Renewable Energy commissioned after 8th March 2019 or Pumped Storage Systems or Battery Storage Systems.
  • Wind power project plants commissioned between 2033 and 2034 will be subject to a 25% ISTS fee.
  • ISTS charge will be 50% for plants being commissioned between 2034 to 2035.
  • Full ISTS charges will apply to plants which will be commissioned after 2037.
  • 25 percent ISTS charges will apply to Green Hydrogen and Green Ammonia plants being commissioned between 2030 to 2031.
  • Full ISTS charges will apply to Green Hydrogen and Green Ammonia plants commissioned after 2036.

Topic: Miscellaneous

9. Northeast's first Vande Bharat Express has been flagged off by Prime Minister Narendra Modi.

  • Northeast's first Vande Bharat Express will connect Guwahati to New Jalpaiguri. It is the third Vande Bharat train of West Bengal.
  • It will reduce the travel time to 5 hours and 30 minutes.
  • Vande Bharat Express was earlier known as Train 18. It is operated by Indian railways.
  • The first Vande Bharat Express between New Delhi and Varanasi was flagged off by PM Modi on 15 February 2019.
  • The second Vande Bharat service was launched between New Delhi and Katra in 2019.

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