1. RBI has not changed the policy rates for the eighth time in a row.
- The Reserve Bank of India’s Monetary Policy Committee has unanimously decided to maintain the status quo on interest rates for the eighth time in a row and maintain the monetary stance accommodative.
- MPC has decided to keep the Repo rate unchanged at 4 percent and Reverse Repo rate at 3.35 percent. MSF rate and bank rate remain unchanged at 4.25%.
- Repo rate is the interest rate at which the RBI provides short-term money to banks against the collateral of government and other approved securities.
- Reverse Repo Rate is the interest rate at which the RBI absorbs liquidity from banks against the collateral of eligible government securities.
- The Monetary Policy Committee (MPC) will continue with the accommodative stance till necessary.
- MPC has kept the real GDP growth projection for FY22 at 9.5 percent. It revised its retail inflation projection for FY22 downwards to 5.3 % against the earlier 5.7 %.
- Bi-monthly monetary policy meeting of was held between October 6 and October 8. MPC had last time cut repo rate by 40 basis points in May 2020. It has maintained the status quo since then.
Monetary Policy Committee:
- MPC is a 6 member committee formed after the amendment in the RBI Act, 1934 through the Finance Act, 2016.
- The Central Government constituted Monetary Policy Committee (MPC) under Section 45ZB determines the policy interest rate required to achieve the inflation target.
- The primary objective of monetary policy is to maintain price stability with growth.
2. Dhanlaxmi Bank empaneled by RBI as Agency Bank.
- Dhanlaxmi Bank has been empaneled by RBI as Agency Bank.
- It is now authorized to undertake general banking businesses of Central and State governments on behalf of the RBI.
- It can now undertake transactions related to government businesses such as revenue receipts and payments on behalf of the Central and State governments.
- It can also undertake transactions related to pension payments in respect of Central and State governments, works related to small savings schemes (SSS) and collection of stamp duty through physical mode or e-mode.
Dhanlaxmi Bank is an Indian private sector bank based in Thrissur, Kerala. Shivan J K is its Managing Director and CEO.
3. Framework for offline digital retail payments proposed by RBI.
- Framework for offline digital retail payments has been proposed by RBI.
- In its Statement on Developmental and Regulatory Policies on August 6, 2020, RBI announced a scheme to conduct pilot tests of innovative technology that enables retail digital payments offline.
- Further, an increase in per-transaction limit for IMPS from ₹2 lakh to ₹5 lakh for channels other than SMS and Interactive Voice Response System (IVRS) has also been proposed by RBI.
- The current limit for an Immediate Payment Service (IMPS) transaction through SMS and IVRS channels is ₹ 5,000.
- RBI has also proposed geotagging of payment system touchpoints. ‘Prevention and Mitigation of Financial Frauds’ has been proposed as a topic for the Fourth Cohort.
- Geotagging is capturing of geographical coordinates through latitude and longitude.
4. Three-year special long-term repo operations (SLTRO) facility for Small Finance Banks (SFBs) extended by RBI.
- Three-year special long-term repo operations (SLTRO) facility for Small Finance Banks (SFBs) has been extended by two months till December 31, 2021.
- This facility is available at the repo rate of 4%. It was announced by RBI in May 2021 to help SFBs provide last-mile credit to individuals and small businesses.
- SFBs are required to deploy liquidity drawn from this facility for fresh lending of up to ₹10 lakh per borrower.
Small Finance Banks (SFBs):
- They offer basic banking services (deposits and lending) only.
- The aim of SFBs is financial inclusion.
- Unlike dual control of UCBs, SFBs are governed by RBI only.
5. 136 countries agree to implement new international tax system.
- Total 136 countries including India have agreed to implement a new international tax system.
- The agreement aims to ensure that Multinational Enterprises (MNEs) will be subjected to a minimum 15 % tax rate from 2023.
- These 136 countries represent more than 90% of global GDP. OECD (Organisation for Economic Co-operation and Development) Secretary-General Mathias Cormann said that the agreement will make our international tax arrangements fairer.
- The two-pillar solution will be presented to G20 Finance Ministers meeting in Washington DC on October 13, then to the G20 Leaders Summit in Rome at October end.
- Pillar One will make sure a fairer distribution of profits and taxing rights among countries with respect to the largest and most profitable multinational enterprises.
- Multinational enterprises with global sales above EUR 20 billion and profitability above 10 per cent will be covered by the new rules. 25 % of the profit above the 10 % threshold to be reallocated to market jurisdictions.
- Pillar Two introduces a global minimum corporate tax rate set at 15%. This rate will apply to companies with revenue above EUR 750 million.
6. The bid for acquiring Air India won by Tata Sons group.
- The bid for acquiring Air India has been won by Tata Sons group. It made a winning bid of Rs 18,000 crore for Air India.
- Talace Private Ltd is a wholly owned subsidiary of Tata Sons. It has emerged as successful bidder for acquiring Air India.
- It beat a Consortium led by Ajay Singh whose bid was Rs 15,100 crore. Both the bidders had quoted above the reserve price of 12,906 crore rupees.
- Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said that winning bid includes taking over of 15,300 crore rupees debt and paying rest by cash.
- He also said that in addition to 100% stake in Air India and its low-cost arm, Air India Express, the winning bid comprises of a 50 % stake in ground-handling company Air India SATS Airport Services Private Limited (AISATS).
- The transaction is likely to be completed by December 2021.
- On 04 October, Inter- Ministerial Group comprising Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal and Civil Aviation Minister Jyotiraditya Scindia approved the winning bid for Air India.
- Civil Aviation Secretary Rajiv Bansal said that no employee will be retrenched and Tata Sons will retain all the employees for one year and in 2nd year if someone is to be retrenched then a Voluntary Retirement Scheme (VRS) option will be given.
- The process for disinvestment of Air India and its subsidiaries started in June 2017. The process re-commenced on 27 January 2020.
- Tata Group had earlier run Air India before it was nationalized in 1953.
- In 1932, industrialist Jehangir Ratanji Dadabhoy had launched it.
- It flew its first flight as Tata Airlines on 15 October 1932.
7. Government approved setting of seven mega textile parks.
- The Union government has approved the setting up of seven mega textile parks, to boost domestic manufacturing of textiles.
- The 7 Mega Integrated Textile Region and Apparel Parks (MITRA) will be set up at Greenfield/Brownfield sites located in different states with an outlay of Rs 4,445 Crore.
- The Sites for the park will be selected by a "Challenge Method" based on objective criteria.
- The parks will follow the ‘5F’ Formula --- farm to fiber; fiber to factory; factory to fashion; fashion to foreign.
- 50 percent area of the park will be used for pure manufacturing activities, 20 percent area for utilities, and 10 percent of the area for commercial development.
- The parks will be developed by a special purpose vehicle (SPV) owned by the state government and the central government in a public private partnership (PPP) mode.
- It will enhance the competitiveness of the textiles industries. It will create job opportunities for millions of people.
- Rs 500 crore will be provided to all Greenfield parks and Rs 200 crore to brownfield parks for the development of common infrastructure.
8. CoinSwitch Kuber becomes India’s 2nd crypto unicorn.
- CoinSwitch Kuber has become India’s 2nd crypto unicorn.
- CoinSwitch Kuber announced that it raised $260 million in Series C funding round. It is now valued at $1.9 billion.
- CoinDCX earlier became India’s first cryptocurrency unicorn.
- As per a report by US-based blockchain data platform Chainalysis, India’s cryptocurrency market this year grew 641 % over the past year.
CoinSwitch Kuber is an app-based cryptocurrency exchange platform. It is based in Bengaluru. It was founded in June 2020. Ashish Singhal is its Co-founder and CEO.
9. Soumen Ray appointed as Chief Financial Officer of Bharti Airtel (Airtel).
- Soumen Ray has been appointed as Chief Financial Officer of Bharti Airtel (Airtel).
- His appointment will be effective from December 21.
- He will join Airtel from Bajaj Auto Ltd. He takes over from Badal Bagri.
- He will report to Gopal Vittal, Managing Director and Chief Executive Officer, (India and South Asia), Airtel.