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RBI’s MPC may keep rates steady in next policy review: Barclays



Reserve Bank Of India

The Central bank is best served by maintaining the policy approach outlined in the October statement, even as it likely acknowledges some optimistic turn in growth indicators and sticky inflation, investment banker Barclays said on Wednesday ahead of the Monetary Policy Committee (MPC) policy review early next month.

“We expect the Reserve Bank of India’s (RBI) monetary policy committee to keep rates steady next week, even though we expect its inflation and growth forecasts to be revised higher,” Barclays said in its research report on emerging markets.

The actions announced by the Central bank in its October MPC meeting have achieved some success in keeping borrowing costs low across the public and private sector, as well as reducing risk – premia. The investment banker said that these policies will be needed for longer to enhance credit flows in the economy.

As such, with the economy remaining on the path of a gradual recovery and facing sticky supply side price pressures, we expect the RBI to stay on hold, maintain an accommodative stance, and continue to emphasise that a “durable improvement in growth” is needed before it would re-look at policy settings, the report said.

The RBI’s policy announcements in October were bold and effective in many aspects. The bank provided enhanced forward guidance — promising to keep an accommodative stance through next year — as well as moving further into providing additional liquidity support by saying it may buy state government bonds. Notably, the bank noted that upside inflation surprises were mostly supply driven, hence likely to be transient and warranting little monetary response.

“As such, we think nurturing growth will remain central to the monetary policy and the RBI is likely to repeat the guidance provided in the October policy review,” the report added.

A key focus of policymakers has been to ease financial conditions in the economy. With little room to make further direct rate cuts given above target inflation, the RBI has made a number of unconventional moves to reduce the cost of capital across the economy. Along with enhanced forward guidance that the accommodative monetary stance will remain, the Central bank has eased a slew of regulatory norms and stepped up its pace of government bond buying over the past few weeks. This has ushered in a concomitant decline in interest rates across the economy, as government financing costs remain capped and risk spreads narrow. However, rate easing has not yet fully percolated down to the retail borrower, where credit-off take remains weak, Barclays said.


Panaji restaurants to use biogas: Pramod Sawant




Select restaurants in Panaji will soon be hooked into a biogas supply network being set up by the city municipal corporation, Chief Minister Pramod Sawant said on Friday.

A network of a dozen biodigester plants has been created in the city by the muncipal corporation.

Sawant said that biogas would be provided free of cost to the city’s restaurants for some time, as part of the initiative taken by the Corporation of the City of Panaji, which he said was in sync with the Goa government’s sustainable development goals (SDG).

“It is a new innovative system, where we will use the biogas generated by these biodigester plants and supply it free of cost to restaurants located near these plants at the initial stage,” Sawant said.

“The restaurant owners will see merit in using biogas because it will reduce their cost of LPG cylinder dependency by half,” the Chief Minister also said.

A network of 12 biodigesters is being set up in the state capital, Sawant said.

“The biodigesters will promote clean energy in a big way. Food and vegetables which are routinely wasted and strewn in the open in municipal markets will be processed in these machines to create biogas,” he also said.

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Yogi Adityanath boost for startups: 4 get Rs 20 lakh



Uttar Pradesh Chief Minister Yogi Adityanath. (File Photo: IANS)

As part of the ‘Start in UP’ programme, the policy implementation unit in the state has approved marketing assistance of Rs 5 lakh each to four startups, including one that aims to use artificial intelligence for face recognition to provide safety for women and children.

Alok Kumar, additional chief secretary (IT and electronics), who heads the unit, said that the funds would be released to the four startups over a period of a year to allow them to launch a ‘minimum viable product’ in the market.

The four startups, which have been granted approval, include G. Systems of Prayagraj for farming, Enray Solutions LLP of Ghaziabad for solar power, Bhurak Technologies of Saharanpur for a face recognition project and Matfusion Weld Pvt. Ltd. of Lucknow for a project in the biofuel sector.

Bhurak Technologies of Saharanpur has been founded by Kumar Satyam who has developed a prototype of artificial intelligence-based face recognition system, mainly to ensure safety of children and women through facial recognition.

G. Systems, founded by Ashish Kushwaha, aims to promote smart farming systems based on the Internet of Things (IoT) with machine learning-based sensors for automated irrigation and other farm-related activities.

Enray Solutions LLP founder Rishabh Bhardwaj has developed a prototype of a water-free automatic solar panel cleaning system to mitigate wastage of drinkable water.

Matfusion Weld Pvt. Ltd. has been registered by Vivek Kumar which is working on the concept of converting waste cooking oil into biofuel. It has already entered into a 10-year contract for supplying biofuels to Indian Oil Corporation.

Alok Kumar said that the objective of facilitation and incentives in the early stages of product development was to encourage innovators to stimulate commercialisation of their inventions.

He said that under the new startup policy, seed capital in the form of marketing assistance up to Rs 5 lakh per startup will be given to 10 startups, per incubator per year to launch a minimum viable product in the market.

“Under this provision, seed capital will be disbursed in milestone-based instalments in three tranches, 40 per cent as advance and 30 per cent in two instalments on the completion of milestones,” he said.

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Plant closure: SC declines Vedanta’s plea for early hearing of appeal




The Supreme Court on Friday declined to entertain a plea by Vedanta seeking early hearing on its appeal filed against the Madras High Court order, which declined to allow the reopening of its Tuticorin plant.

As the Tamil Nadu government had filed a special leave petition in the top court for expunging certain remarks in the Madras High Court order, a bench headed by Justice R. F. Nariman and comprising Justices Navin Sinha and K. M. Joseph admitted it and tagged it with the main matter.

In the meanwhile, during the hearing, counsel appearing for Vedanta requested the top court for an early hearing on its appeal against the Madras High Court order but the bench declined to entertain this plea.

The mining major had moved the top court in August against the High Court order declining to allow the reopening of the Tuticorin plant as it had upheld the orders of Tamil Nadu Pollution Control Board (TNPCB) which directed the closure of the plant in May 2018.

On December 2, the Supreme Court had declined to entertain an interim plea by Vedanta Ltd seeking permission to inspect and operate Sterlite Copper unit at Tuticorin for four weeks to assess the pollution level.

Senior advocate A.M. Singhvi, appearing for the company, had submitted that Vedanta is producing 36 per cent of the copper demand of the country and it is a case of mala fide closure of the plant. Vedanta sought handing over of the plant for three months, where two months would be needed to start the unit, and in order to find out whether the plant is polluting, the company should be allowed to run it for four weeks.

The Tami Nadu government objected to these submissions and submitted before the top court that the plant has been polluting consistently. But, Singhvi contended the court should allow the company to run the plant, which would help in ascertain whether the plant is polluting beyond the acceptable limit.

Senior advocate Colin Gonsalves, representing some villagers in the vicinity of the plant, had submitted the unit should not be allowed to operate, as it is contaminating the water and people are suffering from diseases like cancer.

After a detailed hearing in the matter, the bench said: “Having heard Abhishek Manu Singhvi, C.S. Vaidyanathan, K.V. Viswanathan and Colin Gonsalves, all senior advocates, for some time, we are of the view that the relief(s) in this IA cannot be granted. Accordingly, this IA is dismissed.”

However, the top court said the main matter, the appeal against the High Court order, can come up for hearing after physical hearing resumes in the top court.

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