ISSUE: 799 2025 17 February 2025
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FPIs pull out Rs 21,272 cr in Feb; 2025
outflows near Rs 1 lakh cr: The exodus of FPIs
from the Indian equity markets continues as they
pulled out Rs 21,272 crore in the first two weeks of
this month, driven by global tensions after the US
imposed tariffs on imports. This came following a
net outflow of Rs 78,027 crore in January. With
these, the total outflow by FPIs has reached Rs 99,299 crore — near Rs 1
lakh crore — in 2025 so far, data with the depositories showed.
(Moneycontrol)
Zoho’s Sridhar Vembu warns of higher inflation after Donald
Trump’s reciprocal tariffs threat: Zoho Corporation’s co-founder
Sridhar Vembu on Sunday raised concerns of higher inflation in the
coming months as India is likely to increase imports from the United
States, following President Donald Trump’s reciprocal tariffs threat. India
will also have to find ways to cut consumer goods imports from China and
increase domestic production, said Vembu. In a post on social media
platform X, Sridhar Vembu said: “As a slightly oversimplified mental
model, India exports software services to America and imports consumer
goods from China. The surplus with America is more than matched by the
deficit with China. Now India will (have to) import more iPhones, GPUs,
LPG, nuclear plants, fighter jets, whiskey and so on from America to
balance the bilateral trade.”
(Mint)
DOGE reveals $21 million US money was spent on Indian
elections and $29 million on Bangladesh politics: The US
Department of Government Efficiency (DOGE) has revealed that over
$750 million in taxpayer funds were allocated for various international
projects, including election-related initiatives in India and Bangladesh.
The department announced on Sunday that these expenditures had been
cancelled. Among the cancelled funds was $21 million earmarked for
“voter turnout in India” and $29 million for “strengthening the political
landscape in Bangladesh.” The revelation has sparked debate over the use
of US taxpayer dollars in foreign electoral processes.
(Financial Express)
SBI slashes EBLR, RLLR; home loans, other
loans' lending rates to come down: State
Bank of India has recently announced a reduction
in its External Benchmark-based Lending Rate
(EBLR) and Repo Linked Lending Rate (RLLR) for
various loans, including home loans. The revised
lending rates will come into effect on February 15,
2025. This decision follows the Reserve Bank of India's (RBI) recent cut
in the repo rate by 25 basis points (bps) from 6.50% to 6.25% during its
MPC meeting last week.
(Business Today)
Standard Chartered gets RBI nod to appoint PD Singh as India
CEO: Reserve Bank of India (RBI) has given its approval to appoint
corporate banking veteran and former JP Morgan India CEO Prabdev
(PD) Singh as the CEO for Standard Chartered (StanC) in India and
South Asia people familiar with the matter said. Singh will start his three
year term on April 1 succeeding Zarin Daruwala who retires from the
bank at the end of March, these people said. PD Singh was the top choice
for the Asia focussed UK bases lender among three names sent to the
RBI. Singh had stepped down as CEO of JP Morgan in India, in June last
year before the end of his term.
(Economic Times)
Bank of Maharashtra gets RBI nod for opening GIFT City
branch: State-owned Bank of Maharashtra (BoM) on Sunday said it has
received approval from the Reserve Bank of India to set up an
International Financial Services Centre (IFSC) Banking Unit at GIFT City.
The branch will function as Bank of Maharashtra's first international
branch carrying out offshore banking operations from India.
(Economic Times)
LIC launches marketing tech platform under project DIVE:
State-owned Life Insurance Corporation of India (LIC) on Friday said it
has launched its marketing technology (MarTech) platform to redefine
customer engagement. The platform is the first major milestone in
project DIVE (Digital Innovation and Value Enhancement). This platform
enables LIC to offer hyper-personalized customer engagement and
reinforce its commitment to global leadership in digital insurance
innovation. With the launch of the MarTech platform, LIC has taken the
first leap on its bold new journey of digital transformation, one that will
redefine customer engagement in the insurance sector.
(Economic Times)
No more PLIs in India’s manufacturing push:
The government has dropped a plan to launch new
production Linked Incentive (PLI) schemes, given
that many of the existing ones are yet to produce
satisfactory outcomes. However, it is likely to
announce new incentive schemes for a clutch of
industries, where India’s manufacturing
competitiveness is seen to be long-hanging fruit.
These incentives will, however, be markedly different from PLI schemes
in terms of structure and objectives, with a sharper focus on job creation
and quality of products , official sources said. While the Budget FY26
stated that new schemes would be rolled out for toys and
leather/footwear, similar schemes may be on the cards for chemicals,
bicycles, shipping containers etc., the sources added. “The spirit of PLI
has been lost. PLI is no longer the favoured baby,” an official said, on
condition of anonymity. The exact contours of the new schemes are still
under discussion.
(Financial Express)
Indian companies cautious amid Trump's threat of reciprocal
tariffs: Indian companies and trade organisations are adopting a
cautious approach, watching and waiting to see how the situation unfolds
following US President Donald Trump’s threats to impose reciprocal
tariffs on Indian exports to the US. India runs a trade surplus with the US
at $45 billion in calendar year 2024, according to Morgan Stanley,
making it the seventh-largest trade surplus among nations that have a
trade surplus with the US. Some industries likely to be affected by the
reciprocal tariff include automobile (auto) components, steel,
pharmaceuticals, and textiles, say analysts.
(Business Standard)
First 'Made-in-India' chip to be launched by September-
October: Vaishnaw: Minister of Information and Broadcasting
Ashwini Vaishnaw has said the first 'Made-in-India' chip will come out in
September or October this year. Addressing the media in Bengaluru on
Saturday, Vaishanw said the government has granted Rs 334 crore to the
Indian Institute of Science (IISc), Bengaluru, "for new research and
development (R&D) in gallium nitride, a technology in semiconductors,
which is used in telecom and power." The government will soon come out
with a production-linked incentive (PLI) scheme for components, he
added.
(Economic Times)
New Fastag rules from February 17, 2025:
National Payments Corporation of India and the
Ministry of Road Transport & Highways have issued
two new major changes to the Fastag. The
government body is set to implement stricter
guidelines for processing transactions and
chargebacks, aiming to streamline toll payments
and reduce disputes. Starting February 17, 2025, new Fastag rules will
affect users who delay payments or have blacklisted tags. Apart from this,
there are changes in terms of the Chargeback process and cooling period
as well as transaction rejection rules to streamline toll payments and
reduce disputes. Fastag users may incur additional charges if their toll
transactions are processed beyond 15 minutes from the time the vehicle
passes the toll reader. According to updated National Electronic Toll
Collection (NETC) guidelines, if a transaction is delayed and the user’s
Fastag account has insufficient balance, the toll operator will be held
responsible. However, if the amount is deducted, users can dispute the
charge, but only after a mandatory 15-day cooling period. Under the new
rules, banks can raise chargebacks for incorrect deductions related to
blacklisted or low-balance Fastags only after 15 days. If a Fastag has been
inactive for more than 60 minutes before the vehicle crosses the toll and
remains inactive up to 10 minutes after passing, the transaction will be
declined.
(Moneycontrol)
Bima Vahak's portal is ready for soft launch in April 2025, says
Irdai: The portal for Bima Vahak, the localised, women-centric
insurance field sales force, is nearing completion and is set for a soft
launch for onboarding 'Vahaks' from April 2025, the insurance regulator
said in its press release. The Insurance Regulatory and Development
Authority of India (Irdai) held a quarterly meeting with CEOs of life and
non-life insurance firms in Hyderabad during the two-day Bima Manthan
on February 13 and 14, 2025, to discuss key issues related to the phased
launch of Bima Trinity. The regulator also said, “A compliant, simple,
comprehensive, and customer-friendly model has been signed off by the
top brass of the industry.”
(Business Standard)
RBI KEY RATES FOREX EQUITY
(RBI REF. ) /COMM. MARKET
Repo Rate: 6.25% INR / 1 USD : 86.8862 Sensex: 75939.21 (-199.76)
SDF: 6.00% INR / 1 GBP : 109.1221 NIFTY: 22929.25 (-102.15)
MSF /Bank Rate: 6.50% INR / 1 EUR : 90.8581 Bnk NIFTY: 49099.45 (-260.40)
CRR: 4.00% INR /100 JPY: 56.9300
SLR: 18.00%
BUSINESS/FINANCIAL CONCEPTS
CYCLICAL UNEMPLOYMENT
Cyclical unemployment is a type of unemployment that occurs when
the economy goes through ups and downs. It's caused by changes in
business activity, such as recessions and economic expansions.
During a recession, demand for goods and services decreases, which
leads to businesses laying off workers. During an economic expansion,
demand for goods and services increases, which leads to businesses
hiring more workers.
Cyclical unemployment can slow economic growth and make it difficult
for people to maintain a basic standard of living.
Expansionary monetary policy can help reduce cyclical unemployment.
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