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<keyword id="3658" type="General" weightage="20" keywordseo="india" source="Orion">India</keyword>'s total merchandise exports are expected to grow by 33 per cent during the second quarter of <keyword id="5027223" type="General" weightage="20" keywordseo="fy22" source="Orion">FY22</keyword>, the <keyword id="402797" type="General" weightage="20" keywordseo="export-import-bank-of-india" source="Orion">Export-Import Bank of India</keyword> said on Friday. Accordingly, <keyword id="10407892" type="General" weightage="20" keywordseo="india-exim-bank" source="Orion">India Exim Bank</keyword> forecast total merchandise exports in Q2FY22 to grow to $98.45 billion from $74.02 billion reported for the corresponding quarter of the previous financial year. Besides, non-oil exports are expected to rise 28.3 per cent to $85.63 billion, as compared to $66.73 billion reported for the corresponding quarter of the last fiscal. "The rise in India's exports could be attributed largely to the low base effect, pick-up in growth in advanced economies and the resultant increase in global import demand," India Exim Bank said in a statement. "Increase in commodity prices have also contributed to the increase in India's exports," it added. The forecasts are based on India Exim Bank's Export Leading Index (ELI) model. These forecast are released by India Exim Bank on a quarterly basis, during the first week of June, September, December and March for the corresponding quarters. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/ronnie-screwvalas-investment-firm-leads-10-million-round-in-lido-learning/articleshow/86093922.cms">Ronnie Screwvala’s investment firm leads $10 million round in Lido Learning</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/den-networks-hathway-cable-biocon-alembic-pharma-ujjivan-financial-services-eron-international-stocks-are-going-down/slidelist/86093519.cms">Den Networks, Biocon, Alembic Pharma and more -- here’s why these companies made no money to investors even in a bull run</a>

India's exports expected to grow by 33% during the second quarter

<ul><li>On 27 September, India’s central bank eased a liquidity coverage requirement imposed on banks and said it would provide all necessary funding support to the banking sector. </li><li>The <keyword id="30067" type="ORGANIZATION" weightage="20" keywordseo="RBI">RBI</keyword> has raised the facility to avail funds for liquidity coverage ratio (LCR), which measures the amount of liquid assets held by banks against short-term <keyword id="44647" type="ORGANIZATION" weightage="20" keywordseo="debt">debt</keyword>, from 11% to 13%. </li><li>This will allow banks to increase the weightage given to government securities when calculating their <keyword id="6493444" type="DEFINITION" weightage="20" keywordseo="Statutory-Liquidity-Ratio">statutory liquidity ratio</keyword> and free up deposits for their short-term funding needs. </li></ul>Following <a href="https://www.businessinsider.in/indias-main-financial-regulators-and-its-largest-bank-are-trying-to-calm-investors-amid-fears-of-a-liquidity-crisis/articleshow/65929921.cms">a promise </a>to investors that it would step in to prevent a liquidity crisis amongst Indian lenders as well as a subsequent <a href="https://in.reuters.com/article/india-shadowlenders/finance-ministry-urges-rbi-to-take-steps-to-ease-liquidity-tackle-credit-crunch-idINKCN1M609Y">push</a> from India’s finance ministry, the Reserve Bank of India (RBI) looks like its making good on its word, albeit at the cost of its mandate to manage risk. On 27 September, India’s central bank eased a requirement imposed on banks related to liquidity coverage and said it would provide all necessary funding support to the banking sector. The RBI raised the facility to avail funds for liquidity coverage ratio (LCR), which measures the amount of liquid assets held by banks against short-term debt, from 11% to 13%. This will allow banks to increase the weightage given to government securities, which is a liquid asset, when calculating their statutory liquidity ratio, which measures the amount of deposits invested in liquid assets. Hence, this will free up banks’ deposits so they can meet their funding needs in the short-term. And their funding needs are dire. Earlier this week, the liquidity deficit was estimated to be ₹1.4 trillion. However, In doing so, the RBI is effectively trading short-term benefits for longer-term pain. The current liquidity crisis stems from the aversion of institutional investors to buy the debt instruments of non-banking financial companies like IL&amp;FS, which is on the brink of default. By relaxing liquidity coverage requirements for banks, the RBI is allowing banks greater freedom in how they use their deposits and also letting them take on riskier short-term debt so a lot more money will enter the system, which will have an inflationary effect. In essence, domestic lenders are being allowed to use a greater percentage of their deposit-holders’ money to pay down their short-term debt obligations and extend credit to borrowers. In the event of a market downturn or a loss of faith in these banks, they could face a run on their deposits, which will be fatal given their lower risk buffer. The finance ministry has insisted that the RBI also relax reserve requirements for banks, under which banks set aside a certain portion of funds with the central bank. Earlier this week, the RBI took a page out of the European Central Bank’s playbook on <a href="https://www.ecb.europa.eu/explainers/show-me/html/app_infographic.en.html">“quantitative easing”</a> and said it would buy around <a href="https://www.thehindubusinessline.com/money-and-banking/rbi-to-conduct-omo-to-infuse-liquidity/article25029705.ece">₹100 billion</a> worth of <keyword id="6370709" type="UNKNOWN" weightage="20" keywordseo="Government-bonds">government bonds</keyword> from the open market to inject funds into the economy.

The Reserve Bank of India is trying to prevent a liquidity crisis at banks by relaxing an important risk requirement

Just a few months after relaxing the <keyword id="446542" type="UNKNOWN" weightage="100" keywordseo="gold-import">gold import</keyword> rules, the government is now planning to re-impose the curbs as the country's fascination for gold has led to a surge in the import of gold. 
 The revenue department of the <keyword id="47209" type="ORGANIZATION" weightage="80" keywordseo="Finance-Ministry">Finance Ministry</keyword> has asked the <keyword id="144110" type="ORGANIZATION" weightage="100" keywordseo="Department-of-Economic-Affairs">Department of Economic Affairs</keyword> (DEA) and the <keyword id="6354335" type="CITY" weightage="80" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> (RBI) to reconsider the May 21 relaxation in the import rules. 
 
The RBI had relaxed the 80:20 rule, as it is called, in May at the behest of the Finance Ministry. Under this rule, nominated agencies were allowed to import gold provided they agreed to export 20% of the import. 
 
In September, the trade deficit increased to an 18-month high of $14 billion following a 450% increase in gold imports as importers were in a hurry to take advantage of the relaxation. "Gold imports have risen since the norms were relaxed...There is a concern. We have written to the DEA and the RBI," said a finance ministry official." 
 
Experts welcomed the move. "Given the country's dependence on imported commodities and fluctuation in currency, government will take all steps to address any factor that seeks to threaten macroeconomic stability of the country," said DK Pant, chief economist, India Ratings.

Government Mulls Re-imposing Gold Import Curbs To Control Trade Deficit

<ul><li>As the US sanctions on <keyword id="41896" type="LOCATION" weightage="20" keywordseo="Iran">Iran</keyword> are set to take into effect in November, the Indian government has been ordered to wind down its purchases of Iranian <keyword id="6359072" type="UNKNOWN" weightage="20" keywordseo="oil">oil</keyword>. </li><li>This will be difficult. <keyword id="3658" type="LOCATION" weightage="20" keywordseo="India">India</keyword> is the second-largest buyer of Iranian crude oil, which is cheaper than oil sourced from other countries. </li><li>Therefore, in order to bypass sanctions, Indian refiners will pay for Iranian oil in <keyword id="6540311" type="UNKNOWN" weightage="20" keywordseo="rupees">rupees</keyword> and route payments through <keyword id="49007" type="COMPANY" weightage="20" keywordseo="Uco-Bank">UCO Bank</keyword> and IDBI Bank. </li></ul>When the Trump administration decided to pull out of the Iran Nuclear deal earlier this year and re-impose sanctions on Iran, the Indian government likely panicked. India is the second-largest buyer of Iranian crude oil, sourcing more than 10% of its overall oil <keyword id="35091" type="CITY" weightage="20" keywordseo="imports">imports</keyword> from the Middle Eastern country. Iran provides the commodity at significantly lower prices than other countries and also offers India a host of perks such as extended credit terms and cheaper freight costs. This has manifested itself in higher purchases. India’s oil imports from Iran more than doubled to <a href="https://financialtribune.com/articles/energy/87503/iran-india-drop-dollar-in-oil-trade">27.2 million tonnes</a> in the previous financial year. As the US-led sanctions are set to take into effect in November, the Indian government has been ordered to completely wind down its purchases of Iranian oil or risk violating sanctions. However, cutting imports to zero from Iran is unlikely because India simply cannot switch to more expensive sources of crude oil overnight without adverse short-term effects on its already-widening current account deficit and dramatic adjustments to its refineries, which are calibrated to process Iranian oil. Besides, Indian consumers cannot stomach a continued hike in fuel prices. Thankfully, it seems that India has found a way to bypass US sanctions for the time being even as it has <a href="https://timesofindia.indiatimes.com/business/india-business/indias-iran-oil-purchases-to-fade-ahead-of-us-sanctions/articleshow/65807940.cms">reduced imports</a>. Much like they did before the Iran nuclear deal was signed in July 2015, India’s oil refining companies will pay for Iranian oil in rupees instead of euros and dollars starting 4 November, according to the Economic Times. In turn, Iran will use the rupees to pay for Indian imports. The refiners in question - Indian Oil Corp, Nayara Energy and Mangalore Refinery and Petrochemicals - will route payments through UCO Bank and IDBI Bank, which have domestic branches in Iran and don’t have any exposure to the US. UCO Bank handled oil payments when the first round of sanctions came into effect in 2011. During 2011-2015, India also routed a portion of the payment to Iranian oil companies through Turkey’s Halk Bank. With regards to the latest round of sanctions, India was said to exploring <a href="https://timesofindia.indiatimes.com/india/india-in-touch-with-eu-over-alternative-payment-mechanism-for-iran-oil-imports/articleshow/65877456.cms">alternative payment options</a> for Iranian oil with the EU. However, it seems that nothing came of the talks.

India’s refiners will bypass US sanctions by paying for Iranian oil in rupees

Mumbai, May 22 () The Reserve Bank on Friday announced a Rs 15,000-crore line of credit to the Export-Import Bank of India, to help the sagging foreign trade. The central bank said Export-Import Bank of India (EXIM Bank) depends on foreign currency borrowings for its operations and as a result of the COVID-19 pandemic, it is unable to raise the resources, due to which the facility is being extended. "It has been decided to extend a line of credit of Rs 15,000 crore to the EXIM Bank for a period of 90 days from the date of availment with rollover up to a maximum period of one year so as to enable it to avail a US dollar swap facility to meet its foreign exchange requirements," Reserve Bank of India Governor Shaktikanta Das said. He said the country's export-import trade has suffered because of external demand crippling owing to the pandemic and decline in import of essential goods and services. Among other measures, the Reserve Bank of India (RBI) has also decided to increase the maximum permissible period of pre-shipment and post-shipment export credit sanctioned by banks from the existing one year to 15 months, for disbursements made up to July 31, 2020, Das said. On the imports front, it has been decided to extend the time period for completion of remittances against normal imports into India (except in cases where amounts are withheld towards guarantee of performance) from six months to 12 months from the date of shipment for imports made on or before July 31, 2020, Das said. According to Das this will provide greater flexibility to importers in managing their operating cycles in a COVID-19 environment. As part of the developmental and regulatory policies, the RBI also announced help to Small Industries Development Bank of India (SIDBI) on the refinance front through the roll over of a three month, Rs 15,000-crore facility announced earlier. "In order to provide greater flexibility to SIDBI in its operations, it has been decided to roll over the facility at the end of the 90th day for another period of 90 days," Das said. For the financial markets, in view of the difficulties reported by the Foreign Portfolio Investors and custodians for adhering to the condition of investing at least 75 per cent of allotted limits are invested in three months, the RBI granted an additional three months to fulfil this requirement. AA DRR DRR

Reserve Bank extends Rs 15,000-cr credit line to EXIM Bank

New Delhi, Jun 22 () Fitch Ratings on Monday said it has revised the outlook to negative from stable of nine Indian banks, including State Bank of India, ICICI Bank and Axis Bank, following lowering of India's sovereign rating outlook due to impact of coronavirus pandemic on the economy. The rating agency revised the outlook for Export-Import Bank of India (EXIM), SBI, Bank of Baroda, Bank of Baroda (New Zealand), Bank of India, Canara Bank, Punjab National Bank, ICICI Bank, Axis Bank while affirming their ratings. At the same time, Fitch has affirmed IDBI Bank Ltd's (IDBI) rating, while maintaining the outlook at negative. "The rating actions follow Fitch's revision of the outlook on the 'BBB-' rating on India to negative from stable on June 18, 2020 due to the impact of the escalating coronavirus pandemic on India's economy," it said in a statement. Fitch said the ratings of all the nine Indian banks are support-driven and anchored to their respective sovereign country rating. "They are based on Fitch's assessment of high to moderate probability of extraordinary state support for these banks, which takes into account our assessment of the sovereign's ability and propensity to provide extraordinary support." The negative outlook on India's sovereign rating, it said, reflects an increasing strain on the state's ability to provide extraordinary support, due to the sovereign's limited fiscal space and the significant deterioration in fiscal metrics due to challenges from COVID-19 pandemic. "The rating action does not affect the banks' Viability Ratings (VRs)," it said. "EXIM does not have a VR as its role as a policy bank makes an assessment of its standalone credit profile less meaningful." While EXIM is of high strategic and systemic importance due to its unique policy role, SBI is the largest Indian bank with nearly 25 per cent market share in system assets and deposits. SBI is 57.9 per cent state-owned and has a much broader policy role than peers. "SBI is highly likely to receive extraordinary state support, if required, due to its very high systemic importance," it said. For ICICI and AXIS Bank, Fitch said it expects a moderate probability of extraordinary state support for these banks, due to their systemic importance, market position and private ownership. "The probability of extraordinary state support for the two large private banks will be lower than for large state banks, which are likely to have priority due to the sovereign's constrained finances," the agency said. The other banks whose outlook was lowered too have "high systemic importance" stemming from their significant market share, majority government ownership and role in policy lending. On keeping outlook unchanged for IDBI, it said this reflects expectation that the state's propensity to provide extraordinary support to IDBI may diminish following the government's proposal to sell its stake in the bank and dispose of part of its stake in the lender's majority shareholder, Life Insurance Corporation of India (LIC). ANZ BAL BAL

Fitch revises outlook of SBI, 8 other banks to negative

The <keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords">RBI</keyword> on Tuesday proposed rationalising <keyword id="19909672" type="General" weightage="20" keywordseo="regulations" source="keywords">regulations</keyword> that cover <keyword id="19986776" type="General" weightage="100" keywordseo="export" source="keywords">export</keyword> and <keyword id="20040382" type="General" weightage="20" keywordseo="import" source="keywords">import</keyword> <keyword id="19971375" type="General" weightage="20" keywordseo="transactions" source="keywords">transactions</keyword> with an aim to promote ease of doing <keyword id="19933715" type="General" weightage="20" keywordseo="business" source="keywords">business</keyword> and empower banks to provide more efficient service to their <keyword id="19986712" type="General" weightage="20" keywordseo="foreign-exchange" source="keywords">foreign exchange</keyword> customers. The central bank has issued 'Regulation of Foreign Trade under Foreign Exchange Management Act (<keyword id="19940710" type="General" weightage="20" keywordseo="fema" source="keywords">FEMA</keyword>), 1999 - <keyword id="20399690" type="General" weightage="20" keywordseo="draft" source="keywords">Draft</keyword> Regulations and Directions' in this regard. As per the draft, every exporter should furnish to the specified authority a declaration specifying the amount representing the full export value of the goods or services. "The amount representing the full export value of goods and services shall be realised and repatriated to India within nine months from the date of shipment for goods and date of invoice for services," it said. The draft also proposes that an exporter who has not realised the full value of export within the time specified may be caution listed by the authorised dealer. An exporter who has been caution listed can undertake export only against receipt of advance payment in full or against an irrecoverable letter of credit, to the satisfaction of the authorised dealer. According to the draft, no advance remittance for the import of gold and silver should be permitted unless specifically approved by the <keyword id="19899810" type="General" weightage="20" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="153" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword>. The RBI said the proposed regulations are intended to promote ease of doing business, especially for small exporters and importers. They are also intended to empower Authorised Dealer banks to provide quicker and more efficient service to their foreign exchange customers, the central bank said. The RBI has sought comments on the draft regulations under FEMA and directions to authorised dealer banks by September 1.

RBI proposes rationalising regulations on export, import transactions

Domestic <keyword id="19910265" type="General" weightage="100" keywordseo="gold-prices" source="keywords">gold prices</keyword> have risen by 10% on a year-to-date basis on the back of the strength in global gold prices, which have surged by 18% year-to-date, driven by robust <keyword id="19894998" type="General" weightage="20" keywordseo="central-bank" source="keywords">central bank</keyword> purchases, heightened geopolitical risks, and growing expectations of a monetary policy pivot from the <keyword id="19901377" type="General" weightage="20" keywordseo="us-federal-reserve" source="keywords">US Federal Reserve</keyword>, according to the <keyword id="20195223" type="General" weightage="20" keywordseo="World-Gold-Council" source="keywords" meta.keywordsubtype="org" meta.entityname="World Gold Council" meta.hostid="153" meta.entityid="World Gold Council">World Gold Council</keyword>. The reduction in <keyword id="20069572" type="General" weightage="20" keywordseo="import-duty" source="keywords">import duty</keyword> has ignited a resurgence in gold demand across <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword>. Reports from the recently concluded India International Jewellery Show indicate a substantial increase in order bookings from retailers, particularly in preparation for the upcoming festive and wedding season. Manufacturers have noted that in some cases, orders have reached levels not seen in several years, underscoring the strong buying interest among <keyword id="21595593" type="General" weightage="20" keywordseo="jewellery-retailers" source="keywords">jewellery retailers</keyword> and consumers alike. The trend of bar and coin buying has also remained robust, with both consumers and jewellers capitalizing on the more attractive prices to stock up for future manufacturing needs. Historical analysis suggests that Indian consumer demand, encompassing jewellery and bar and coin demand, could see an additional 50 tonnes or more in the second half of 2024. This potential increase is fueled by a combination of an initial boost in consumer appetite due to the more attractive prices and a longer-term alignment of local prices with international rates. In a notable shift, domestic gold prices, which had been trading at a discount to international prices for five consecutive months, have now started trading at a premium following the <keyword id="19908389" type="General" weightage="20" keywordseo="Union-Budget" source="keywords">Union Budget</keyword> announcement. The discount had widened significantly in July, reaching a peak of around $80 per ounce in the third week of the month, driven by subdued demand and an increased supply of gold through various preferential trade agreements and unofficial channels. However, wholesalers who had inventory purchased under the old customs duty regime began selling gold at a premium to the landed cost to mitigate their losses, further supported by increased consumer demand. While the premiums have moderated recently, from $28 per ounce to around USD 5 per ounce, this shift highlights the changing market sentiment and the impact of rising international gold prices and potential inventory valuation adjustments. The changes introduced in the Union Budget, including a reduction in the long-term investment holding period and a lower tax rate, have made gold ETFs a more attractive investment option. Data from the Association of Mutual Funds in India (AMFI) reveals that net inflows into gold ETFs in July amounted to Rs 13.4 billion (approximately USD 160 million), marking the highest monthly inflows since February 2020 and an 84% increase compared to June 2024. Despite these inflows, the total assets under management (AUM) for Indian gold ETFs grew marginally by 0.3% from the previous month, reaching Rs 345 billion ($4.1 billion). This modest increase can be attributed to the 8 % fall in domestic gold prices following the import duty reduction. Year-to-date, net inflows into Indian gold ETFs have totalled Rs 45 billion ($543 million), with total AUMs rising by 48 % from a year ago. The <keyword id="19899810" type="General" weightage="20" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="153" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword> (RBI) has continued its gold purchasing trend, although at a slower pace following a significant increase in June, when purchases reached 9.3 tonnes--the highest monthly total in nearly two years. Year-to-date, the RBI's gold acquisitions have totaled 44.3 tonnes, surpassing the total purchases of the past two years combined. The RBI's gold reserves have now reached a record 849 tonnes, representing 8.8% of total foreign reserves, compared to 7.5 % a year ago. In July, gold imports remained steady at $3.1 billion, maintaining the stable trend observed over the previous three months. Between April and July, imports averaged $3.2 billion, with volumes ranging between 43 and 47 tonnes during this period. The gold import bill for July 2024 was 11 % lower than the previous year, with an estimated 26% decrease in volume terms, around 47 tonnes. Despite a surge in international gold prices, domestic gold prices in India have experienced a notable decline, primarily due to the 9 % reduction in import duty announced in the Union Budget 2024-25. This policy change has led to a 6% decrease in the landed cost of gold, marking a shift in the domestic gold market dynamics.

Domestic gold prices surge 10% amid global price rally, central bank buying: World Gold Council

New Delhi, May 22 () The measures announced by RBI on Friday will provide more liquidity in the hands of exporters which would help them in fulfilling their overall obligations during these difficult times of COVID-19, according to exporters. Welcoming RBI's decision to extend the loan repayment moratorium for another three months up to August 31, Apparel Export Promotion Council (AEPC) Chairman A Sakthivel said the central bank has taken effective steps to protect the sector. The Reserve Bank of India(RBI) on Friday announced a Rs 15,000-crore line of credit to the Export-Import Bank of India, to boost the sagging foreign trade. Among other measures, the central bank has decided to increase the maximum permissible period of pre-shipment and post-shipment export credit sanctioned by banks from the existing one year to 15 months, for disbursements made up to July 31, 2020. "RBI's decisions to ensure access to affordable and collateral free loans, moratorium on term loans, easing of working capital financing, increase of export credit period to 15 months from 12 months, extension of packing credit period for existing loans, among others will go a long way in ensuring the survival and growth of exporters," Sakthivel said in a statement. He added that the flexibilities extended to the institutions and exporters availing credit will help in addressing the need of the apparel export industry for a buffer period in stabilising their business after the restart. Sharing similar views, Federation of Indian Export Organisations (FIEO) said the repo and reverse repo rate cut of 40 basis points, extension in the moratorium period for three months along with the extension of the pre and post shipment credit for the exports sector has come as a much needed respite for the sector. "This will allow more liquidity in the hands of the exporters thereby helping them in fulfilling their overall export obligation during such difficult and testing times. We are ushering into an era of very competitive credit rates to help manufacturing and overall economy," FIEO President Sharad Kumar Saraf said. He said these measures will not only help in revival of growth but will also help in mitigating the impact of COVID-19 while ensuring that the inflation remains within the target range. "Besides, steps taken with regard to outward remittance for imports being extended from 6 months to 12 months will help importers as they will have the longer repatriation period," he said. Trade Promotion Council of India (TPCI) Chairman Mohit Singla said financially stressed exporters will benefit from unforeseen circumstances beyond control, on account of importers' inability to pay within 6 months and thus causing offence in India. Therefore, increasing the time of outward remittance from 6 months to 12 months, will surely help as they will have a longer payment time, Singla said. "The loan moratorium increase from 3 months to 6 months is a very welcome move allowing an exporter with wider window to manage financial conditions better. This will ease the pressure from borrower of one-time accumulated payment by increasing the payback cycle," Singla added. Further, he said measures like extending the dollar swap facility to Exim Bank, extension of import payments from 6 month to 12 month and increasing the exporters' length of credit to 15 months will solve the working capital woes of traders to a considerable extent and ease the pressure of making immediate payment. Vikramjit Sahney, President of International Chamber of Commerce, Paris-India welcomed the RBI Governor's announcement to extend moratorium on term loans till August 31 and reduce repo rate to 4 per cent. Sahney, however, expressed concerns over Indian banks becoming very conservative in these tragic times as the economy faces both demand and supply side constraints. He also expressed concerns over Indian banks not opening clean Letter of Credits (LoC) by insisting on various corona-related clauses or not discounting LoCs from reputable banks hampering international trade of the country. RR ANU ANU

Exporters hail RBI move, say measures will boost liquidity in sector

New Delhi, Feb 16 () The government has decided to pump Rs 1,300 crore into state-owned Export-Import Bank of India (Exim Bank) to fund its business growth.Last year, the government doubled its authorised capital from Rs 10,000 crore to Rs 20,000 crore."The (Rs 1,300 crore) provision is for Exim Bank as equity support/ subscription to increase the paid up capital of the bank to the level of its authorized capital," as per the Budget documents presented in Parliament earlier this month.This is Rs 350 crore higher than provision made by the government for the current fiscal. The government earmarked Rs 950 crore capital infusion for the bank.Exim Bank is the principal export credit agency in India and the infusion will give an impetus to new initiatives such as supporting Indian textile industries, likely changes in the Concessional Finance Scheme, likelihood of new letters of credit in future in view of the country's active foreign policy and strategic intent.Established in 1982, Exim Bank is the apex financial institution for financing, facilitating and promoting the country's international trade.The bank primarily lends for exports from India, including supporting overseas buyers and Indian suppliers for export of developmental and infrastructure projects, equipment, goods and services from India. DP BAL

Govt to infuse Rs 1,300 cr in Exim Bank next fiscal

The Reserve Bank of India has liberalised gold import rules with immediate effect, by allowing seven more trading houses to procure the precious metal in order to boost trade.
 According to officials, the move could surge <keyword id="477622" type="UNKNOWN" weightage="80" keywordseo="gold-imports">gold imports</keyword> by India from its current levels. In 2013, India imposed a record high duty of 10% on overseas purchase of gold, in order to check the ballooning <keyword id="113688" type="UNKNOWN" weightage="80" keywordseo="trade-deficit">trade deficit</keyword>. The decision to ease the restrictions allows more than 20 segments, including <keyword id="118444" type="COMPANY" weightage="80" keywordseo="Jewellers">jewellers</keyword>, bullion dealers, and bank and trade bodies, to import the precious metal. 

	Banks are now allowed to provide gold loans to domestic jewellery makers. This practice was stopped last year.
 

	The new guidelines will also increase legal monthly imports by 10-15 tonnes from the current 20 tonnes.
 

	According to an analyst, gold metal loans are of great significance as they are expected to release the cost pressures.
 India's Prime Minister designate <keyword id="6354477" type="PERSON" weightage="80" keywordseo="Narendra-Modi">Narendra Modi</keyword> has also indicated his willingness to ease the curbs. 

	The plan to ease the restrictions is ready for the new BJP government to take up.

RBI Eases Gold Import Rules

<ul><li>According to <keyword id="6354424" type="COMPANY" weightage="20" keywordseo="world-bank">World Bank</keyword>, <keyword id="6354484" type="PERSON" weightage="20" keywordseo="Donald-Trump">Donald Trump</keyword> has simply window dressed the level of tariffs in <keyword id="3658" type="LOCATION" weightage="20" keywordseo="India">India</keyword> by calling the nation ‘<keyword id="6925005" type="UNKNOWN" weightage="20" keywordseo="tariff-king">tariff king</keyword>’. </li><li>Data with the international financial institution indicates that while India may have ‘high’ import tariffs, they aren’t even the highest among the Southeast Asian countries. </li><li>Officials with the World Bank also believe that tariffs have been consecutively reduced since the lndian economy’s liberalisation in 1992. </li></ul>The World Bank and the President of the United States, Donald Trump, do not share a common opinion in on the level of taxes imposed by India on imported goods. In fact, the international financial institution <a href="https://www.business-standard.com/article/economy-policy/india-is-not-a-tariff-king-says-world-bank-official-on-trump-s-remarks-118103101278_1.html">slammed Trump’s comment</a> calling India a ‘<a href="https://www.livemint.com/Politics/L5sKtcdGYDOJDLuFOSlEeO/India-may-have-to-pay-a-price-for-protectionism.html">tariff king’</a>. While India certainly has relatively higher tariffs in comparison to the rest of the world, data with the World Bank indicates that it’s not even the highest among the South-Asian countries. <a href="https://www.business-standard.com/article/economy-policy/india-is-not-a-tariff-king-says-world-bank-official-on-trump-s-remarks-118103101278_1.html">According to Shanta Devarajan</a>, a Senior Director for Development at the World Bank, while tariffs in India certainly high circa 1991, they have since then reduced high taxes levied on many goods. In comparison to ten years ago, the taxation system is much more liberal. Devarajan believes that liberalisation has actually helped India to boost its economic growth. Trump had earlier <a href="https://kashmirobserver.net/2018/business/india-tariff-kingwants-trade-deal-us-keep-me-happytrump-36608">alleged that India imposes tariffs as high as 100% on many American goods</a>. He even cited an example of Harley Davidson motorcycles on which India had imposed a 100% tariff. The US President added that many other American products also face high tariffs, which act as a barrier to entry in the Indian market, instigating that consumers are worse off since, as a result of these high tariffs, they will have access to fewer imported products.

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India's exports expected to grow by 33% during the second quarter

IANS

The Reserve Bank of India is trying to prevent a liquidity crisis at banks by relaxing an important risk requirement

Dilsher Dhillon

Government Mulls Re-imposing Gold Import Curbs To Control Trade Deficit

BI India Bureau

India’s refiners will bypass US sanctions by paying for Iranian oil in rupees

Dilsher Dhillon

Reserve Bank extends Rs 15,000-cr credit line to EXIM Bank

PTI

Fitch revises outlook of SBI, 8 other banks to negative

PTI

RBI proposes rationalising regulations on export, import transactions

PTI

Domestic gold prices surge 10% amid global price rally, central bank buying: World Gold Council

ANI

Exporters hail RBI move, say measures will boost liquidity in sector

PTI

Govt to infuse Rs 1,300 cr in Exim Bank next fiscal

PTI

RBI Eases Gold Import Rules

BI India Bureau

World Bank contradicts Trump’s comment over higher tariffs imposed by India on American goods

BI India Bureau

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