1. Asia's largest Civil Aviation event ‘WINGS INDIA 2022’, start in Hyderabad
Tags: Economics/Business
Asia's largest Civil Aviation “WINGS INDIA” has started on 24 March 2022 at Begumpet airport in Hyderabad. The 5th edition of the event has been organised by the Union Ministry of Civil Aviation and FICCI (Federation of Indian Chambers of Commerce and Industries) from 24 -27 March 2022.
However the event will be officially inaugurated by the Union Minister of Civil Aviation Jyotiraditya Scindia on March 25,.
The theme of the “WINGS INDIA” 2022 is :“India@75: New Horizon for Aviation Industry.”
The event is organised every two years and this is the fifth edition of the “WINGS INDIA”.
The four-day event will present a platform for industry leaders, companies, and other stakeholders to interact, discuss business and explore other opportunities.
India used to hold a single biennial air show in Bengaluru earlier, combining both the defence and civil aviation sectors. In 2008, it was decided that commercial aviation merits a separate exhibition, following which the Indian Civil Aviation Airshow was inaugurated at Begumpet Airport in Hyderabad.
The show's name was changed to Wings India in 2017.
The defence air show “Aero India“ is organised every two year at at the Yelahanka Air Force Station, Bengaluru Karnataka.
2. India aims nuclear power capacity of 22480 MW by 2031
Tags: Economics/Business
The Government of India has set a target of 22480 MW of installed nuclear power capacity by 2031. At present the installed nuclear capacity in India is 6780 MW.
The government has approved the construction of 10 indigenous Pressurised Heavy Water Reactors (PHWRs) of 700 MW capacity each and 500 MW of Prototype Fast Breeder Reactor (PFBR). Government expects these projects to be completed by 2031 and the total installed capacity in India will be 22480 MW by 2031.
The Government of India has also informed the Parliament that it has approved the proposal to set up a few new Nuclear power plants in India.
The newly approved Nuclear Power plants are
Site & Location | Capacity (MW) | In Cooperation With |
Jaitapur, Maharashtra | 6 X 1650 | France |
Kovvada, Andhra Pradesh | 6 X 1208 | United States of America |
Chhaya, MithiVirdi, Gujarat | 6 X 1000 | United States of America |
Haripur, West Bengal | 6 X 1000 | Russia |
Bhimpur, Madhya Pradesh | 4 X 700 | Indigenous |
Operational Nuclear Power Plant in India
Kaiga(Karnataka): installed capacity 880 MW
Kalpakkam (Tamil Nadu),Installed capacity 440 MW
Kakrapar (Gujarat),Installed capacity 440 MW
Narora (Uttar Pradesh ),Installed capacity 440 MW
Tarapur (Maharashtra ),Installed capacity 1440 MW
Rajasthan Atomic power plant , Rawatbhata, Installed capacity 1180 MW
Kudankulam (Tamil Nadu). It is being built by Russia, Installed capacity 2000 MW
Presently, India has 22 nuclear power reactors operating in 7 states, with an installed capacity of 6780 MW.
Important for Exam
The Atomic Energy Commission was set up in August 1948 and Dr Homi Jhangir Bhahba was its first director.
Dr Homi Jahngir Bhabha is considered to be the father of the Indian Atomic programme.
The first nuclear reactor of India and Asia was set up in Mumbai and became operational in 1956. It was a nuclear research reactor named APSARA.It was shut down in 2009.
The first nuclear power plant in India was set up at Tarapur,Maharstra in 1969. It was set up with the help of the United States.
3. India to import muriate of potash from Israel for Kharif season
Tags: Economics/Business
India is building a stock of fertiliser for the forthcoming Kharif season by importing fertilisers from Israel to ensure sufficient supplies for the coming Kharif season after the disruption of shipments caused by Russia's invasion of Ukraine.
Indian Potash Ltd has signed a five-year deal to import 600,000 tonnes of muriate of potash from Israel Chemical Ltd.
India is a major importer of fertiliser in the world. India depends on imports for its entire annual consumption of 4 million to 5 million tonnes of potash and it used to import a third of this from Belarus and Russia.
Landlocked Belarus uses ports in Russia and Lithuania for its exports.Following Russia's invasion of Ukraine, shipping routes have been closed off and western sanctions on Moscow, have made it difficult to trade with Russian and Belarusian companies
India Potash Limited is a Public Sector Undertaking under the Department of Fertilisers, Ministry of Chemicals and Fertilisers, Government of India.
Cropping Season In India
There are broadly three cropping season in India
Kharif : These are sown in the rainy season from June/July and harvested in October /November
Main crops Paddy, maize, Soybean, Groundnut, Cotton, Arhar, Moong , urad
Rabi : These are sown in the winter season in the month of November/December and harvested in the month of March/April.
Main crops are Wheat , mustard, gram pea, potato, oats, Barley. Sunflower, gram etc.
Zaid : These are grown after Rabi season and before the start of Kharif season. Mainly vegetables, water melon, Cucumber etc are grown
4. Start up get 10 years to convert debt into equity
Tags: Economics/Business
In a major relief to the start up companies in India the government of India has extended the period for converting the debt instrument issued by the start up into equity shares to 10 years from the earlier 5 years .
According to the Department for Promotion of Industry and Internal Trade(DPIIT) under the Ministry of Commerce and Industry , a convertible note can be converted into equity shares or redeemed within 10 years from its issuance by a startup company. This is likely to help the start up in raising funds .
What is a convertible note
It is a debt paper issued by a company to its investor for the money it has received from them . The debt is converted into equity shares after a certain time period or is redeemed after a certain time period .
How it works
Suppose a startup company A receives Rs 100 from an investor B. The company issues a paper to B saying it has received Rs 100 from B for 5 years and it will pay an interest of 2 percent per annum to B. The paper also mentioned that company A will return back the Rs 100 amount to B or instead of paying Rs 100 it will convert it into 2 equity shares of the company after 5 years.
For a detailed definition of Start up in India see 16 January 2022 post
5. RBI lifts all restrictions on HDFC Bank's new digital launches
Tags: Economics/Business
Reserve Bank of India has lifted the restriction placed on the largest private bank , HDFC Bank digital business plan . In December 2020, RBI imposed a ban on the bank from new digital launches and getting new customers for its credit card business.
This was done by the RBI after it received complaints from the bank customers of glitches in the bank's internet banking and mobile banking based services.
In August 2021, RBI lifted the ban on its credit card business but the restriction on its new digital launches was not lifted. Now all the restrictions have been removed.
Important for Exams
The Largest issuer of Credit cards in India : HDFC Bank
The second largest issuer of credit is SBI and then ICICI bank
The largest issuer of Debit Cards in India : SBI .
HDFC Bank
It is the largest private bank in India .
It is the second largest bank in India after SBI
The headquarter of HDFC bank is Mumbai.
- Chief Executive Officer (CEO): Shashidhar Jagdhisan
6. India ranks second in global investment in digital shopping
Tags: Economics/Business
India is the second-largest global venture capital investment destination for digital shopping companies. It grew by 175 per cent from USD 8 billion in 2020 to USD 22 billion in 2021, according to the London & Partners analysis of Dealroom.co investment data.
India was second to the United States of America. In 2021 America attracted USD 51 billion in investment, followed by China at third with USD 14 billion and the UK at fourth with USD 7 billion.
In the world ,Bengaluru was the top city in the world which attracted an investment worth USD 14 billion and Gurugram came at no 7 with an investment worth USD 4 billion and Mumbai at No. 10 with USD 3 billion in 2021.
- In the world New York City of the United States came second after Bengaluru and San Francisco also of the United States came third.
7. Government of India has extended Interest Equalisation System
Tags: Economics/Business
To boost the export from the country ,the government of India has extended the “Interest Equalisation Scheme for Pre and Post Shipment Rupee Export Credit (‘Scheme’)” up to March 31, 2024 or till further review, whichever is earlier. The extension takes effect from October 1, 2021 and ends on March 31, 2024.
The scheme was announced by the government of India in April 2015 and has been extended from time to time.
Under the scheme the interest equalisation rates for the large Micro Small and Medium Enterprises (MSME) manufacturers and exporters under any Harmonized System (HS) will be 3% and two per cent for manufacturer exporters and merchant exporters exporting under 410 HS lines (after excluding 6 HS lines of the telecom sector).
What is the Interest Equalisation scheme
The scheme includes both Interest subsidy and reimbursement.
How it works
Banks in India have the power to decide the interest rates on loans .
Suppose SBI loan rate is 9% and it provides loans to the eligible exporters at 9 % interest rates . Suppose the exporters come under a 3% interest equalisation scheme. Then the banks will provide the loan at 9% and later will credit the subsidy amount of 3% in the exporter accounts.
Effectively the exporter gets the loan at 6%. Here the interest subsidy is 3%.
Then the SBI will approach the Government of India with proper documents and claim the interest subsidy of 3% from the government . The government will reimburse the SBI . Thus the bank will get its money with no loss and the exporter will get a loan at a cheaper rate which will help in boosting exports from India .
The export target for merchandise export for 2021-22 is $400 billion.
Post and Pre shipment Credit
Loan Or credit provided to the exporter can be divided into Pre-shipment and Post- Shipment.
Pre shipment credit
As the name suggests it is given to the exporter for meeting its export requirement before shipping the exported goods .
Suppose ABC company gets a Rs 1000 order to export chairs to a United States company . The ABC company will need money to buy the raw materials to make the chair which is to be exported . It will approach a bank with the export order and ask for a loan for this purpose . The bank, after being satisfied, can provide it a loan so that it is able to fulfil its export order .
This loan is called Pre -shipment credit .
Post -Shipment Credit
The ABC company ships the chairs and after that it will receive the money from the American importer. It will take time. But the ABC company needs money for its business now. Here the ABC company will approach the bank and show it a receipt from the customs that it has shipped $100 worth of chairs to an American and ask for a loan from the bank.
The bank, after being satisfied, can give a loan to ABC Company so that it can continue its business and the company will return the loan after it receives the money from the American.
This is called Post-Shipment credit .
8. Axis Bank launches a co branded credit card with Airtel
Tags: Economics/Business
Indian private bank Axis bank has launched a co-branded credit card for the customers of the second largest telecom company in India,Airtel.
Airtel being a telecom company cannot issue credit cards on its own .
Only banks in India regulated by the Reserve Bank of India can issue credit cards in India .
Important for Exam
Axis Bank : It started its business as UTI bank in 1993. It’s name was changed to Axis Bank in 2007.
Headquarters of Axis Bank : Mumbai, Maharashtra
Managing Director and Chief Executive Officer : Amitabh Chaudhary.
9. Impact of Russian-Ukrainian war on Diamond Industry in India
Tags: Economics/Business
The Russian Invasion of Ukraine and the resultant sanctions by the western countries led by the United States on Russia has created uncertainty in the diamond sector in India.
India is one of the centres of global diamond trade and around 90% of rough diamonds in the world are cut and polished in India, especially in the Gujarati city of Surat.
India is the largest exporter of cut and polished diamonds in the world. During the April to January 2021-22 period the export of cut and polished diamond was $20.06 billion which is around 6% of the total merchandise export from India.
India is totally dependent on imported diamonds and it imported $14.83billion of rough diamonds during the April to January 2021-22 period.
The major supplier of the diamond to India is the world’s largest diamond company, Alrosa of Russia which contributes to around 30% of world’s natural production.
Major banks of Russia have been banned from the SWIFT (Society for Worldwide International Financial Telecommunication) financial messaging system for international payment. This has created a problem of payment by the Indian importers to Russia as payment and settlement in American dollars and Euro is becoming virtually impossible.
This is likely to create a major problem for the diamond industry in India which creates lakhs of jobs in India.
Fact About Diamond
Top producer of rough diamonds in the world
The largest producer of natural diamond in the world is Russia followed by Botswana and Congo (2016 Data). These three companies control over 60% of the world's natural diamond production.
The world's largest diamond trading companies are Alrosa of Russia followed by De Beers of Luxembourg and Rio Tinto company of Australia and Britain.
10. Wheat and Maize export opportunity for India
Tags: Economics/Business
Demand for India wheat and maize (corn) has increased in the world after the Russian -Ukraine war . Maize or Corn is the largest produced grain in the world and wheat is the second largest produced grain in the world .
The largest exporter of wheat in the world was Russia and Ukraine was the fifth largest exporter of wheat in the world after the US ,Canada and France in 2019.Together they contribute about 25% of world wheat exports.
Corn which is the largest produced grain in the world . It is also called the Queen of cereals because it has the highest genetic yield potential among the cereals.
The biggest exporter of maize in the world was the United State followed by Argentina,Brazil,Ukraine and France in 2019.
The contribution of Ukraine was 13.4% of the total export in the world. The Odessa port of Ukraine has stopped its operation after the war and the supplies have come to a halt.
Western Europe, Turkey, Philippines are some of the largest buyers of Russian and Ukrainian wheats
Opportunity to boost Indian wheat export
India is likely to benefit from this situation . The Food Corporation of India has a buffer stock of about 26million tonnes of wheat stock against the mandatory requirement of 4.4 million ton of buffer stock and 3 million tonnes of strategic reserves .
Also wheat production in India is expected to be around 111.32 million tonnes this year.
India has enough stock to export. In Asia India only has an exportable wheat stock India is receiving enquiries from Asia, North Africa, for import of wheat .India also enjoys logistics advantage as it is nearer to some of the prospective buyers like Thailand, Egypt Etc. The cost of shipment is less as compared to the United States of America .
Fact File wheat
Largest producer of wheat in the world in 2020
China was the largest producer of wheat in the world followed by India, Russia. United States of America and Canada .
The largest producer of Wheat in India is Uttar Pradesh, Madhya Pradesh and Punjab(Source Economic Survey 2021-22)
Egypt is the Largest importer of Wheat in the world .
Export of wheat :The country has exported 20,88,487.66 MT of wheat to the world for the worth of $ 549.70 million during the year of 2020-21.
Major Export Destinations (2020-21) : Bangladesh, Nepal, United Arab Emirates Sri Lanka, Yemen.
(Source : Agricultural and Processed Food Products Export Development Authority)
Fact File Maize
The largest producer of maize in the world is the United States followed by China, Brazil . India is the sixth largest producer of India .
The largest producer of maize in India is Karnataka followed by Madhya Pradesh and Maharashtra .
In India, maize is the third most important food crops after rice and wheat
Exports : The total export of maize from India in 2020-21 was 28,79,202.93 million tonnes worth $ 634.85 million .
Destination of Indian Maize Export : Bangladesh, Vietnam, Nepal, Malaysia,Myanmar .
(Source : Agricultural and Processed Food Products Export Development Authority)
