General Affairs
PM Narendra Modi meets China's Xi Jinping during SCO summit in Kazakhstan
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Prime Minister Narendra Modi met Chinese President Xi Jinping today in Astana, Kazakhstan, on the sidelines of the Shanghai Cooperation Organisation (SCO) - a consortium that focuses on security and trade.
The meeting comes amid growing differences between the two countries over a host of issues, including the China-Pakistan Economic Corridor and India's Nuclear Suppliers Group membership bid.
The meeting between top leaders of the neighbouring Asian countries is the first after India boycotted the high-profile Belt and Road Forum held in Beijing last month in which 29 world leaders took part.
India abstained from the Summit to highlight its concerns over the US$ 50 billion China-Pakistan Economic Corridor which is part of the Belt and Road Initiative (BRI) and passes through Pakistan-occupied Kashmir (PoK). Later in the day, both India and Pakistan were inducted in SCO as member nations.
PM MODI GREETS NAWAZ SHARIF
Earlier, Prime Minister Narendra Modi exchanged greetings with Pakistan Prime Minister Nawaz Sharif. Both the leaders were at the leaders' lounge at an Opera in the evening before the concert and banquet hosted by Kazakhstan president Nursultan Nazarbayev.
According to sources, Modi and Sharif exchanged greetings. Since it was the first occasion when the two leaders came across each other after Sharif's operation, Modi enquired about his health.
He also enquired about Sharif's mother and family. This was their first meeting since 2015 when PM Modi flied down to Lahore on a surprise visit.
Prime Minister Narendra Modi met Chinese President Xi Jinping today in Astana, Kazakhstan, on the sidelines of the Shanghai Cooperation Organisation (SCO) - a consortium that focuses on security and trade.
The meeting comes amid growing differences between the two countries over a host of issues, including the China-Pakistan Economic Corridor and India's Nuclear Suppliers Group membership bid.
The meeting between top leaders of the neighbouring Asian countries is the first after India boycotted the high-profile Belt and Road Forum held in Beijing last month in which 29 world leaders took part.
India abstained from the Summit to highlight its concerns over the US$ 50 billion China-Pakistan Economic Corridor which is part of the Belt and Road Initiative (BRI) and passes through Pakistan-occupied Kashmir (PoK). Later in the day, both India and Pakistan were inducted in SCO as member nations.
PM MODI GREETS NAWAZ SHARIF
Earlier, Prime Minister Narendra Modi exchanged greetings with Pakistan Prime Minister Nawaz Sharif. Both the leaders were at the leaders' lounge at an Opera in the evening before the concert and banquet hosted by Kazakhstan president Nursultan Nazarbayev.
According to sources, Modi and Sharif exchanged greetings. Since it was the first occasion when the two leaders came across each other after Sharif's operation, Modi enquired about his health.
He also enquired about Sharif's mother and family. This was their first meeting since 2015 when PM Modi flied down to Lahore on a surprise visit.
Now, protests in Punjab, Haryana in support of Madhya Pradesh farmers
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Madhya Pradesh farmer unrest has also sparked protests in Punjab and Haryana. While a faction Bhartiya Kisan Union (BKU) staged a symbolic protests in Punjab on Thursday, others have announced solidarity protests for Monday.
Bhartiya Kisan Union (BKU, Ekta group) has announced statewide protests in Punjab on Monday to express solidarity with the Mandsaur farmers besides the demand to waive off farmer debt in Punjab. The farmers will protest at every district collectorate between 11 am - 4 pm and will demand registration of criminal cases against the police officials accused of firing at the protesters in Mandsaur by submitting memorandums.
"We had planned protests on Friday but postponed them following a government holiday. Now we will protest on Monday. This will be a day long protest. We will organise a state level meet to discuss future plan of action on July 7 if the state government fails to waive off farmer debt as promised in election manifesto," Secretary, Bhartiya Kisan Union Sukhdev Singh Kokri told India Today .
However, as evident, the state government may not be in a position to provide relief to the farmers as the committee set up by the state government to gauge the size of debt and to plan a compensation criteria has sought more time. This is likely to vitiate the situation as the farmers are already in a mood to step up offensive after July 7.
"We appeal the farmers to maintain calm. As promised we will waive off the debt but some codal formalities are necessary and we are already on the job," Finance Minister, Punjab Manpreet Singh Badal said.
Besides Punjab, the farmers in neighbouring Haryana are also gearing up to protest against the step motherly treatment being meted out to them by the state government authorities. The farmers will meet in New Delhi on Saturday to chalk out the strategy to hold the protests.
Besides the debt, the farmers are also seeking increase in support price which is almost half of the input cost. The average monthly income of a farmer in India is less than Rs 1700 which is the root cause of farmer suicides as they are compelled to raise loans even to meet day to day expenses.
Madhya Pradesh farmer unrest has also sparked protests in Punjab and Haryana. While a faction Bhartiya Kisan Union (BKU) staged a symbolic protests in Punjab on Thursday, others have announced solidarity protests for Monday.
Bhartiya Kisan Union (BKU, Ekta group) has announced statewide protests in Punjab on Monday to express solidarity with the Mandsaur farmers besides the demand to waive off farmer debt in Punjab. The farmers will protest at every district collectorate between 11 am - 4 pm and will demand registration of criminal cases against the police officials accused of firing at the protesters in Mandsaur by submitting memorandums.
"We had planned protests on Friday but postponed them following a government holiday. Now we will protest on Monday. This will be a day long protest. We will organise a state level meet to discuss future plan of action on July 7 if the state government fails to waive off farmer debt as promised in election manifesto," Secretary, Bhartiya Kisan Union Sukhdev Singh Kokri told India Today .
However, as evident, the state government may not be in a position to provide relief to the farmers as the committee set up by the state government to gauge the size of debt and to plan a compensation criteria has sought more time. This is likely to vitiate the situation as the farmers are already in a mood to step up offensive after July 7.
"We appeal the farmers to maintain calm. As promised we will waive off the debt but some codal formalities are necessary and we are already on the job," Finance Minister, Punjab Manpreet Singh Badal said.
Besides Punjab, the farmers in neighbouring Haryana are also gearing up to protest against the step motherly treatment being meted out to them by the state government authorities. The farmers will meet in New Delhi on Saturday to chalk out the strategy to hold the protests.
Besides the debt, the farmers are also seeking increase in support price which is almost half of the input cost. The average monthly income of a farmer in India is less than Rs 1700 which is the root cause of farmer suicides as they are compelled to raise loans even to meet day to day expenses.
Mumbai: Maharashtra government cannot find its own notification notifying national, state highways
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The Bombay High Court today was informed by the Maharashtra government pleader that it cannot find the notification classifying roads as state highways and other roads. The reason Maharashtra government is looking for this notification is because a bunch of petitions have been filed by liquor vendors and restaurant owners claiming that the excise department is now not renewing their licenses to sell or serve liquor as the department claims they are located on the highways.
It was in December last year that the Supreme Court in its landmark judgment of State of Tamil Nadu V/s. K. Balu and others had directed for not issuing license to liquor shops and permit rooms within distance of 500 mtrs form the national and state highways. By the said judgment the apex court had also directed for not renewing license of existing shops and for not issuing new license for such shops after 31st March, 2017 along national and state highways.
The petitioners claim that the bars, restaurants and wine shops are neither situated on a national highway nor on a state highway, but is located in by-lanes of the city, more than 500 meters from the highways. For example, one of the petitioners is King Wines, which is located in the heart of Kolhapur city. The petitioner submits that recently, their licenses were renewed for this year on accepting requisite license fees by the district collector and superintendent of state excise in Kolhapur. However, the same authorities, after renewal, directed the wine shop owner to forthwith, stop all their business owing to Supreme Court's order.
Thus, during the last hearing on May 31st the division bench of Justice B P Colabawalla and Justice A M Badar had asked for the notification. Advocate Shrikrishna Ganbavale who is appearing for the petitioners explained, "There has to be a notification from state government that this road or that road is a national highway or a state highway. Without that the state government cannot arbitrarily close down business establishments. That is why they have been asked to show the notifications."
The court has granted the state government time till Monday to get these notifications and has even asked the advocate general of Maharashtra to appear before them.
The Bombay High Court today was informed by the Maharashtra government pleader that it cannot find the notification classifying roads as state highways and other roads. The reason Maharashtra government is looking for this notification is because a bunch of petitions have been filed by liquor vendors and restaurant owners claiming that the excise department is now not renewing their licenses to sell or serve liquor as the department claims they are located on the highways.
It was in December last year that the Supreme Court in its landmark judgment of State of Tamil Nadu V/s. K. Balu and others had directed for not issuing license to liquor shops and permit rooms within distance of 500 mtrs form the national and state highways. By the said judgment the apex court had also directed for not renewing license of existing shops and for not issuing new license for such shops after 31st March, 2017 along national and state highways.
The petitioners claim that the bars, restaurants and wine shops are neither situated on a national highway nor on a state highway, but is located in by-lanes of the city, more than 500 meters from the highways. For example, one of the petitioners is King Wines, which is located in the heart of Kolhapur city. The petitioner submits that recently, their licenses were renewed for this year on accepting requisite license fees by the district collector and superintendent of state excise in Kolhapur. However, the same authorities, after renewal, directed the wine shop owner to forthwith, stop all their business owing to Supreme Court's order.
Thus, during the last hearing on May 31st the division bench of Justice B P Colabawalla and Justice A M Badar had asked for the notification. Advocate Shrikrishna Ganbavale who is appearing for the petitioners explained, "There has to be a notification from state government that this road or that road is a national highway or a state highway. Without that the state government cannot arbitrarily close down business establishments. That is why they have been asked to show the notifications."
The court has granted the state government time till Monday to get these notifications and has even asked the advocate general of Maharashtra to appear before them.
Jammu and Kashmir: 5 terrorists killed as infiltration bid foiled along LoC in Uri, high alert sounded
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As many as five terrorists have been gunned down as the Army foiled another infiltration bid in Uri sector of Jammu and Kashmir. The encounter is underway. A high alert has been sounded along the Line of Control.
This is the fourth incident of infiltration on LoC in north Kashmir during the last 48 hours.
Yesterday, two infiltration bids were foiled in Uri and Machil sectors, in which 3 terrorists and a jawan were killed.
Three Army jawans were also injured in the crossfire.
4 TERRORISTS KILLED IN MACHIL ENCOUNTER
On Wednesday, another infiltration was foiled in Machil in which four terrorists were killed.
Massive search and combing operations by the Army are going on in four areas near the LoC - Nowgam, Machil, Keran and Uri.
It is believed that many terrorists are being pushed in Jammu and Kashmir by terror groups and during the last one week, it is the tenth infiltration bid that has been foiled on the LoC.
As many as five terrorists have been gunned down as the Army foiled another infiltration bid in Uri sector of Jammu and Kashmir. The encounter is underway. A high alert has been sounded along the Line of Control.
This is the fourth incident of infiltration on LoC in north Kashmir during the last 48 hours.
Yesterday, two infiltration bids were foiled in Uri and Machil sectors, in which 3 terrorists and a jawan were killed.
Three Army jawans were also injured in the crossfire.
4 TERRORISTS KILLED IN MACHIL ENCOUNTER
On Wednesday, another infiltration was foiled in Machil in which four terrorists were killed.
Massive search and combing operations by the Army are going on in four areas near the LoC - Nowgam, Machil, Keran and Uri.
It is believed that many terrorists are being pushed in Jammu and Kashmir by terror groups and during the last one week, it is the tenth infiltration bid that has been foiled on the LoC.
Coal block case: ED attaches assets worth Rs 206 crore of Chhattisgarh-based steel plant
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The Enforcement Directorate (ED) today attached assets worth Rs 206 crores in connection with its probe against Jayaswal Neco Industries Limited in a coal block allocation case. The attachment is done under the Prevention of Money Laundering Act.
ED initiated the investigation in the case under the Prevention of Money Laundering Act (PMLA) on the basis of an FIR registered by the CBI against Jayaswal Neco Industries Ltd and its Directors. CBI has filed Charge Sheet before the Special Judge, Patiala House, New Delhi against Jayaswal Neco Industries Ltd, and its directors for alleged commission of Offence under Section 120B read with 420 and 406 of IPC.
As per investigations coal block was obtained by Jayaswal Neco through fraudulent means by making misrepresentation and the company resorted to illegal use of coal mined in their captive power plant (CPP) without any permission from central government.
As per allocation letter the company had to wash the coal in a washery to 20 per cent ash level and the middling, rejects produced during the process to be used in its CPP. However, the coal was used directly in their sponge iron plant and CPP, without setting up a washery or without any approval for its use in the CPP directly.
During the investigation by ED, it emerged that the company had extracted 3.8 million tonnes of coal during the period 2006-2015 from the said Coal field. The company used the entire coal mined from coal block for production of steel and power in its plant, therefore, the profit accrued out of sale of such steel and power has been accumulated in the reserve and surplus of the company and the company during the period under consideration has expanded its production capacity and fixed assets.
After deducting the royalty and the additional cess paid by the company, it is seen that the company had benefited to the extent of Rs. 206 crore on account of extraction of coal from the Coal block which is the part of the proceeds of crime derived as a result of criminal activity relating to the schedule offence.
ED under the PMLA has provisionally attached the plant and machinery at Dagori Integrated Steel Plant, Bilaspur, Chhattisgarh of Jayaswal Neco to the extent of Rs. 206 Crore.
The Enforcement Directorate (ED) today attached assets worth Rs 206 crores in connection with its probe against Jayaswal Neco Industries Limited in a coal block allocation case. The attachment is done under the Prevention of Money Laundering Act.
ED initiated the investigation in the case under the Prevention of Money Laundering Act (PMLA) on the basis of an FIR registered by the CBI against Jayaswal Neco Industries Ltd and its Directors. CBI has filed Charge Sheet before the Special Judge, Patiala House, New Delhi against Jayaswal Neco Industries Ltd, and its directors for alleged commission of Offence under Section 120B read with 420 and 406 of IPC.
As per investigations coal block was obtained by Jayaswal Neco through fraudulent means by making misrepresentation and the company resorted to illegal use of coal mined in their captive power plant (CPP) without any permission from central government.
As per allocation letter the company had to wash the coal in a washery to 20 per cent ash level and the middling, rejects produced during the process to be used in its CPP. However, the coal was used directly in their sponge iron plant and CPP, without setting up a washery or without any approval for its use in the CPP directly.
During the investigation by ED, it emerged that the company had extracted 3.8 million tonnes of coal during the period 2006-2015 from the said Coal field. The company used the entire coal mined from coal block for production of steel and power in its plant, therefore, the profit accrued out of sale of such steel and power has been accumulated in the reserve and surplus of the company and the company during the period under consideration has expanded its production capacity and fixed assets.
After deducting the royalty and the additional cess paid by the company, it is seen that the company had benefited to the extent of Rs. 206 crore on account of extraction of coal from the Coal block which is the part of the proceeds of crime derived as a result of criminal activity relating to the schedule offence.
ED under the PMLA has provisionally attached the plant and machinery at Dagori Integrated Steel Plant, Bilaspur, Chhattisgarh of Jayaswal Neco to the extent of Rs. 206 Crore.
Business Affairs
GST Council meet: Next meeting on June 11 to review rates, amend rules
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The all powerful GST Council will meet on Sunday to review some of the rates on which industry has expressed displeasure, besides amending the draft rules.
This will be the 16th meeting of the Council, chaired by Finance Minister Arun Jaitley and comprising state counterparts, since it was set up in September 2016.
"Main agenda items include confirmation of the minutes of the 15th GST Council meeting held on June 3, approval of amendments to draft GST rules and rate adjustment, if any, based on the representations received from different trade and industry and their associations," a finance ministry statement said.
The June 11 meeting would probably be the last one of the Council before the Goods and Services Tax (GST) is rolled out from July 1.
Various industry associations have sought a review of the tax rates saying that the GST incidence is working out to be much higher than the present level of taxation.
The auto industry has been demanding a review of the GST rate on mid and large-sized hybrid cars which are proposed to be taxed at 43 per cent, higher than the current level of effective tax rate of 30.3 per cent.
Also, the telecom sector has been placed in the 18 per cent tax bracket and they are demanding that the rate should be lowered. COAI has written to Revenue Secretary to review the matter.
IT hardware firms are seeking an uniform GST rate of 18 per cent on IT products, like monitors and printers, instead of 28 per cent proposed for some items.
The GST Council has fitted almost all goods and services in tax slabs of 5, 12, 18 and 28 per cent. However, precious metals, gold coins and imitation jewellery have been fitted in the 3 per cent slab, and rough diamond at 0.25 per cent.
The GST, which will subsume a host of levies including excise, service tax and VAT, will be rolled out from July 1.
The all powerful GST Council will meet on Sunday to review some of the rates on which industry has expressed displeasure, besides amending the draft rules.
This will be the 16th meeting of the Council, chaired by Finance Minister Arun Jaitley and comprising state counterparts, since it was set up in September 2016.
"Main agenda items include confirmation of the minutes of the 15th GST Council meeting held on June 3, approval of amendments to draft GST rules and rate adjustment, if any, based on the representations received from different trade and industry and their associations," a finance ministry statement said.
The June 11 meeting would probably be the last one of the Council before the Goods and Services Tax (GST) is rolled out from July 1.
Various industry associations have sought a review of the tax rates saying that the GST incidence is working out to be much higher than the present level of taxation.
The auto industry has been demanding a review of the GST rate on mid and large-sized hybrid cars which are proposed to be taxed at 43 per cent, higher than the current level of effective tax rate of 30.3 per cent.
Also, the telecom sector has been placed in the 18 per cent tax bracket and they are demanding that the rate should be lowered. COAI has written to Revenue Secretary to review the matter.
IT hardware firms are seeking an uniform GST rate of 18 per cent on IT products, like monitors and printers, instead of 28 per cent proposed for some items.
The GST Council has fitted almost all goods and services in tax slabs of 5, 12, 18 and 28 per cent. However, precious metals, gold coins and imitation jewellery have been fitted in the 3 per cent slab, and rough diamond at 0.25 per cent.
The GST, which will subsume a host of levies including excise, service tax and VAT, will be rolled out from July 1.
Supreme Court puts partial stay on government order linking Aadhaar with PAN for filing income tax returns
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The Supreme Court on Friday put a partial stay Section 139AA of IT Act, which allows mandatory linkage of Aadhaar for filing income tax returns (ITR) and allotment of PAN (permanent account number).
The apex court said the government could not force people to get Aadhaar until the main issue over privacy is decided. However, the it added that those who already possess the unique ID will have to link it with PAN.
There will be partial stay on implementation of IT Act's provision until the Constitution bench decides the privacy issue regarding Aadhaar.
SC also asked the government to take appropriate steps to ensure there is no leakage of data from Aadhaar scheme.
Previous transactions wont be affected or nullified with partial stay on new law till privacy issue linked to Aadhaar is decided.
A bench comprising Justices A K Sikri and Ashok Bhushan had on May 4 reserved the verdict on the pleas, challenging section 139AA of the Income Tax (I-T) Act, which was introduced in the latest budget and the Finance Act, 2017.
Section 139AA of the Income-tax Act, 1961 as introduced by the Finance Act, 2017 provides for mandatory quoting of Aadhaar / Enrolment ID of Aadhaar application form, for filing of return of income and for making an application for allotment of Permanent Account Number with effect from 1st July, 2017.
SC also asked the government to take appropriate steps to ensure there is no leakage of data from Aadhaar scheme. Previous transactions wont be affected or nullified with partial stay on new law till privacy issue linked to Aadhaar is decided, it said.
The Supreme Court bench had earlier asked the Centre if making Aadhaar mandatory by force was the only way to tackle financial fraud.
While hinting at making Aadhaar mandatory for flying, Minister of State for Civil Aviation Jayant Sinha on Thursday said the Ministry plans to introduce 'digital unique identification' requirement at the time of booking air tickets.
Air travellers are already required to carry a copy of their identity while entering an airport.
Now, a digital unique identification such as Aadhaar, PAN (Permanent Account Number), Passport Number is being proposed for air passengers, Sinha said.
The Supreme Court on Friday put a partial stay Section 139AA of IT Act, which allows mandatory linkage of Aadhaar for filing income tax returns (ITR) and allotment of PAN (permanent account number).
The apex court said the government could not force people to get Aadhaar until the main issue over privacy is decided. However, the it added that those who already possess the unique ID will have to link it with PAN.
There will be partial stay on implementation of IT Act's provision until the Constitution bench decides the privacy issue regarding Aadhaar.
SC also asked the government to take appropriate steps to ensure there is no leakage of data from Aadhaar scheme.
Previous transactions wont be affected or nullified with partial stay on new law till privacy issue linked to Aadhaar is decided.
A bench comprising Justices A K Sikri and Ashok Bhushan had on May 4 reserved the verdict on the pleas, challenging section 139AA of the Income Tax (I-T) Act, which was introduced in the latest budget and the Finance Act, 2017.
Section 139AA of the Income-tax Act, 1961 as introduced by the Finance Act, 2017 provides for mandatory quoting of Aadhaar / Enrolment ID of Aadhaar application form, for filing of return of income and for making an application for allotment of Permanent Account Number with effect from 1st July, 2017.
SC also asked the government to take appropriate steps to ensure there is no leakage of data from Aadhaar scheme. Previous transactions wont be affected or nullified with partial stay on new law till privacy issue linked to Aadhaar is decided, it said.
The Supreme Court bench had earlier asked the Centre if making Aadhaar mandatory by force was the only way to tackle financial fraud.
While hinting at making Aadhaar mandatory for flying, Minister of State for Civil Aviation Jayant Sinha on Thursday said the Ministry plans to introduce 'digital unique identification' requirement at the time of booking air tickets.
Air travellers are already required to carry a copy of their identity while entering an airport.
Now, a digital unique identification such as Aadhaar, PAN (Permanent Account Number), Passport Number is being proposed for air passengers, Sinha said.
After SBI, Govt hints at more bank mergers, eyes to have another global-sized bank
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Enthused by the success of SBI merger, the Finance Ministry is considering clearing another such proposal in the public sector banking space by this fiscal end with a goal to create 4-5 global sized lenders.
Five associate banks and Bharatiya Mahila Bank became part of SBI on April 1, 2017, catapulting the country s largest lender to among the top 50 banks in the world.
Now, the Finance Ministry is looking to replicate the model in the case of other state-run banks so that they reach critical mass to compete with global peers.
"Consolidation is a must...but decision in this regard would be based on commercially prudent parameters. If the NPA situation gets better, there could be one more merger towards the end of this fiscal," a senior official told PTI.
Toxic loans of public sector banks rose by over Rs 1 lakh crore to Rs 6.06 lakh crore during April-December of 2016-17, the bulk of which came from power, steel, road infrastructure and textile sectors.
Finance Minister Arun Jaitley has on several occasions said India needs 5-6 banks of global size and scale and further consolidation in the banking sector will be done at the appropriate time.
Whenever consolidation happens, it takes into consideration interest of all stakeholders including employees and shareholders, the official said, adding it has to be a win-win for all parties.
A balancing act has to be done before any merger is given clearance by various authorities and regulators, the official added.
The future merger proposals in the banking sector will also require clearance from the Competition Commission of India (CCI) to see if the merged entity is going to create a monopoly.
In the last consolidation drive that saw the light of day in April, CCI nod was needed only in the case of merger of the Bharatiya Mahila Bank (BMB) with SBI. There was no such requirement for merger of associate banks with SBI as they were part of the parent.
The Finance Ministry has sought help of the government think-tank NITI Aayog and global consultancy firms to examine the possibility of next round of consolidation of PSU banks with an aim to create a few lenders of global size and scale.
NITI Aayog's report is expected to set tone of the roadmap for consolidation in the future.
There are factors like regional balance, geographical reach, financial burden and smooth human resource transition that have to be looked into while taking a merger decision, the official said.
The official added that there should not be merger of a very weak bank with a strong bank "as it could pull the latter down".
"There are some low-hanging fruits. Big lenders like Bank of Baroda can take over some turnaround banks in the southern region such as Indian Overseas Bank. Dena Bank could be merged with some large South Indian bank," the official explained.
Five associates and BMB became part of SBI on April 1, 2017, catapulting the country s largest lender to among the top 50 banks in the world.
State Bank of Bikaner and Jaipur (SBBJ), State Bank of Hyderabad (SBH), State Bank of Mysore (SBM), State Bank of Patiala (SBP) and State Bank of Travancore (SBT), besides BMB, were merged with SBI.
With the merger, the total customer base of the SBI reached around 37 crore with a branch network of around 24,000 and nearly 59,000 ATMs across the country. The merged entity began operation with deposit base of more than Rs 26 lakh crore and advances of Rs 18.50 lakh crore.
The government in February had approved the merger of these five associate banks with SBI. Later in March, the cabinet approved merger of BMB as well. SBI first merged State Bank of Saurashtra with itself in 2008. Two years later, State Bank of Indore was merged with it.
Enthused by the success of SBI merger, the Finance Ministry is considering clearing another such proposal in the public sector banking space by this fiscal end with a goal to create 4-5 global sized lenders.
Five associate banks and Bharatiya Mahila Bank became part of SBI on April 1, 2017, catapulting the country s largest lender to among the top 50 banks in the world.
Now, the Finance Ministry is looking to replicate the model in the case of other state-run banks so that they reach critical mass to compete with global peers.
"Consolidation is a must...but decision in this regard would be based on commercially prudent parameters. If the NPA situation gets better, there could be one more merger towards the end of this fiscal," a senior official told PTI.
Toxic loans of public sector banks rose by over Rs 1 lakh crore to Rs 6.06 lakh crore during April-December of 2016-17, the bulk of which came from power, steel, road infrastructure and textile sectors.
Finance Minister Arun Jaitley has on several occasions said India needs 5-6 banks of global size and scale and further consolidation in the banking sector will be done at the appropriate time.
Whenever consolidation happens, it takes into consideration interest of all stakeholders including employees and shareholders, the official said, adding it has to be a win-win for all parties.
A balancing act has to be done before any merger is given clearance by various authorities and regulators, the official added.
The future merger proposals in the banking sector will also require clearance from the Competition Commission of India (CCI) to see if the merged entity is going to create a monopoly.
In the last consolidation drive that saw the light of day in April, CCI nod was needed only in the case of merger of the Bharatiya Mahila Bank (BMB) with SBI. There was no such requirement for merger of associate banks with SBI as they were part of the parent.
The Finance Ministry has sought help of the government think-tank NITI Aayog and global consultancy firms to examine the possibility of next round of consolidation of PSU banks with an aim to create a few lenders of global size and scale.
NITI Aayog's report is expected to set tone of the roadmap for consolidation in the future.
There are factors like regional balance, geographical reach, financial burden and smooth human resource transition that have to be looked into while taking a merger decision, the official said.
The official added that there should not be merger of a very weak bank with a strong bank "as it could pull the latter down".
"There are some low-hanging fruits. Big lenders like Bank of Baroda can take over some turnaround banks in the southern region such as Indian Overseas Bank. Dena Bank could be merged with some large South Indian bank," the official explained.
Five associates and BMB became part of SBI on April 1, 2017, catapulting the country s largest lender to among the top 50 banks in the world.
State Bank of Bikaner and Jaipur (SBBJ), State Bank of Hyderabad (SBH), State Bank of Mysore (SBM), State Bank of Patiala (SBP) and State Bank of Travancore (SBT), besides BMB, were merged with SBI.
With the merger, the total customer base of the SBI reached around 37 crore with a branch network of around 24,000 and nearly 59,000 ATMs across the country. The merged entity began operation with deposit base of more than Rs 26 lakh crore and advances of Rs 18.50 lakh crore.
The government in February had approved the merger of these five associate banks with SBI. Later in March, the cabinet approved merger of BMB as well. SBI first merged State Bank of Saurashtra with itself in 2008. Two years later, State Bank of Indore was merged with it.
HDFC to raise Rs 1,500 cr via bond issue on Tuesday
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Mortgage lender HDFC Ltd will raise Rs 1,500 crore through issuance of bonds on a private placement basis next week.
"The object of the issue is to augment long-term resources of the corporation. The proceeds of the present issue would be utilised for financing and refinancing the housing finance business requirements of the corporation," HDFC said in a regulatory filing.
The Housing Development Finance Corporation (HDFC), the largest mortgage firm in the country, regularly raises money through this method.
HDFC said the bonds can be subscribed by only those who are specifically addressed through a communication and no other person can apply. The issue will open on June 13 and close on the same day.
Set to mature by July 2020, the coupon rate on the bonds is fixed at 7.50 per cent per annum.
The HDFC stock closed 0.66 per cent up at Rs 1,644.85 on the BSE today.
Mortgage lender HDFC Ltd will raise Rs 1,500 crore through issuance of bonds on a private placement basis next week.
"The object of the issue is to augment long-term resources of the corporation. The proceeds of the present issue would be utilised for financing and refinancing the housing finance business requirements of the corporation," HDFC said in a regulatory filing.
The Housing Development Finance Corporation (HDFC), the largest mortgage firm in the country, regularly raises money through this method.
HDFC said the bonds can be subscribed by only those who are specifically addressed through a communication and no other person can apply. The issue will open on June 13 and close on the same day.
Set to mature by July 2020, the coupon rate on the bonds is fixed at 7.50 per cent per annum.
The HDFC stock closed 0.66 per cent up at Rs 1,644.85 on the BSE today.
Sensex slips 22 pts in early trade on global cues
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Reversing early gains, the Sensex today declined nearly 22 points today as weak global cues turned investors cautious.
Besides, the market sentiment was hit by the Reserve Bank pegging GDP growth for the current fiscal lower at 7.3 per cent and saying that rush for farm loan waivers may have inflationary spillovers.
The 30-share Sensex was trading 21.53 points lower at 31,249.75 in the early deals. The NSE Nifty fell 14.85 points to 9,649.05.
Among the laggards were sectors such as IT, Tech, Realty, Oil and Gas, Power, Bank and PSU, falling up to 2.31 per cent.
The market today opened on a positive note, helped by a string of factors like better monsoon forecast and the status quo on policy rates by the RBI yesterday.
The Reserve Bank yesterday kept repo rate unchanged, as widely expected, at 6.25 per cent and the reverse repo at 6 per cent.
The 30-share barometer in the opening trade rose by 83.23 points, or 0.26 per cent, to 31,354.51. The gauge had gained 80.72 points in the previous session.
The NSE Nifty too gained 14.40 points, or 0.15 per cent, to 9,678.30 in early trade today.
Cautious trade in Global peers ahead of UK election and testimony from sacked FBI head James Comey on his probe into Donald Trump's links to Russia also influenced sentiment, brokers said.
In the rest of Asia, Japan's Nikkei gained 0.05 per cent while Hong Kong's Hang Seng up 0.03 per cent in early trade today. Shanghai Composite was trading 0.03 per cent higher.
The US Dow Jones Industrial Average ended 0.18 per cent higher in yesterday's trade.
Reversing early gains, the Sensex today declined nearly 22 points today as weak global cues turned investors cautious.
Besides, the market sentiment was hit by the Reserve Bank pegging GDP growth for the current fiscal lower at 7.3 per cent and saying that rush for farm loan waivers may have inflationary spillovers.
The 30-share Sensex was trading 21.53 points lower at 31,249.75 in the early deals. The NSE Nifty fell 14.85 points to 9,649.05.
Among the laggards were sectors such as IT, Tech, Realty, Oil and Gas, Power, Bank and PSU, falling up to 2.31 per cent.
The market today opened on a positive note, helped by a string of factors like better monsoon forecast and the status quo on policy rates by the RBI yesterday.
The Reserve Bank yesterday kept repo rate unchanged, as widely expected, at 6.25 per cent and the reverse repo at 6 per cent.
The 30-share barometer in the opening trade rose by 83.23 points, or 0.26 per cent, to 31,354.51. The gauge had gained 80.72 points in the previous session.
The NSE Nifty too gained 14.40 points, or 0.15 per cent, to 9,678.30 in early trade today.
Cautious trade in Global peers ahead of UK election and testimony from sacked FBI head James Comey on his probe into Donald Trump's links to Russia also influenced sentiment, brokers said.
In the rest of Asia, Japan's Nikkei gained 0.05 per cent while Hong Kong's Hang Seng up 0.03 per cent in early trade today. Shanghai Composite was trading 0.03 per cent higher.
The US Dow Jones Industrial Average ended 0.18 per cent higher in yesterday's trade.
General Awareness
India, UNOSSC launch partnership fund to promote sustainable development
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On June 8, 2017, India and the UN Office for South- South Cooperation (UNOSSC) has launched a partnership fund for supporting sustainable development projects across the world.
More Details about India-UN Development Partnership Fund:
The partnership fund was launched on the occasion of the ‘World Oceans Day’ at Permanent Mission of India to UN.M J Akbar – Minister of State for External Affairs, Syed Akbaruddin – India’s Permanent Representative to the UN, Jorge Chediek – Envoy of the Secretary-General on South- South Cooperation and Director of United Nations Office for South-South Cooperation (UNOSSC), were present at the occasion.
- The objective of this partnership is to reduce poverty and hunger, improving health, education and equality, and expanding access to clean water, energy and livelihoods.
- The fund will be deployed to implement country-level projects that are geared towards achieving the 17 sustainable development goals of the 2030 Agenda.
- The fund will be managed by UNOSSC and will support Southern-owned and led, demand-driven, and transformational sustainable development projects across the developing world.
- Special attention will be given to projects in Least Developed Countries (LDCs) and Small Island Developing States (SIDS).
- ‘Climate Early Warning System in Pacific Island Countries’ has been announced as the first project to receive support from this fund. This project will benefit seven Pacific island countries – Cook Islands, Kiribati, Marshall Islands, Micronesia, Nauru, the Solomon Islands and Tonga.
This is first time India has entered into a partnership with the UN that envisages triangular cooperation with other developing countries.
About United Nations Office for South-South Cooperation (UNOSSC):
UNOSSC was formed by the UN General Assembly to advocate for and coordinate South-South and triangular cooperation within the UN system.
- UNOSSC is hosted by United Nations Development Programme (UNDP) since 1974.
- Director of UNOSSC is the Envoy of the Secretary-General on South-South Cooperation. The Director reports to UNDP Administrator.
On June 8, 2017, India and the UN Office for South- South Cooperation (UNOSSC) has launched a partnership fund for supporting sustainable development projects across the world.
More Details about India-UN Development Partnership Fund:
The partnership fund was launched on the occasion of the ‘World Oceans Day’ at Permanent Mission of India to UN.M J Akbar – Minister of State for External Affairs, Syed Akbaruddin – India’s Permanent Representative to the UN, Jorge Chediek – Envoy of the Secretary-General on South- South Cooperation and Director of United Nations Office for South-South Cooperation (UNOSSC), were present at the occasion.
- The objective of this partnership is to reduce poverty and hunger, improving health, education and equality, and expanding access to clean water, energy and livelihoods.
- The fund will be deployed to implement country-level projects that are geared towards achieving the 17 sustainable development goals of the 2030 Agenda.
- The fund will be managed by UNOSSC and will support Southern-owned and led, demand-driven, and transformational sustainable development projects across the developing world.
- Special attention will be given to projects in Least Developed Countries (LDCs) and Small Island Developing States (SIDS).
- ‘Climate Early Warning System in Pacific Island Countries’ has been announced as the first project to receive support from this fund. This project will benefit seven Pacific island countries – Cook Islands, Kiribati, Marshall Islands, Micronesia, Nauru, the Solomon Islands and Tonga.
This is first time India has entered into a partnership with the UN that envisages triangular cooperation with other developing countries.
About United Nations Office for South-South Cooperation (UNOSSC):
UNOSSC was formed by the UN General Assembly to advocate for and coordinate South-South and triangular cooperation within the UN system.
- UNOSSC is hosted by United Nations Development Programme (UNDP) since 1974.
- Director of UNOSSC is the Envoy of the Secretary-General on South-South Cooperation. The Director reports to UNDP Administrator.
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