May - Current Affairs - Economy

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RBI Directed Indian Banks To Maintain Tier I Capital   

The Reserve Bank of India on 2 May 2012 published guidelines of implementation of the new global capital adequacy norms, called Basel-III, by March 2018. India banks will have to maintain Tier-I capital, or core capital of at least 7% of their risk weighted assets on an ongoing basis. The objective is to strengthen risk management mechanism . As per the guidelines specified by the central bank, commercial banks will have to maintain their total capital adequacy ratio at 9% higher than the minimum recommended  requirement of 8% under the Basel- III norms.

ADB To Provide $6.25 Billion Assistance To India 

The Asian Development Bank (ADB) will provide assistance of $6.25 billion to India over three years for various projects, including those in the energy and education sector. The lending support will go to key areas like transport, energy, urban development, agriculture, natural resource management. Prior to this ADB has approved 159 loans for India amounting to $24.12 billion.

Moody’s Downgrades 3 Private Sector Banks 

Moody’s Investor Services has downgraded the standalone bank financial strength rating of the top three private sector banks- ICICI Bnak, HDFC Bankand Axis Bank. The global credit rating agency also downgraded the Life Insurance Coorporation of India’s foreign currency insurance financial strength rating.

WEF To Open Office In India

The world Economic Forum (WEF), known for its annual Davos meeting on 14 May 2012 said, it will open its full fledged office in India in the wake of the country growing economic clout. Besides, WEF which has been organising annual India event along with the industry body CII, has decided to go solo from this year. The branding of the event would also be changed to world Economic forum on India rather than India economic summit being held annually for the last 27 years.

The World Wildlife Fund  Report On Global Environment    

The World Wildlife Fund (WWF) in its report living planet report 2012 released on 15 May 2012 noted that Biodiversity has decreased by an average of 28 percent globally since 1970 and the world would have to be 50% bigger to have enough land and forest to provide for current levels of consumption and carbon emissions. The problem, by 2030 even two planets Earths would not be enough to sustain human activity. A summit on the global environment is to be held in Brazilian city Rio De Janerio from 20 to 22 June 2012. The summit is expected to draw more than 50,000 participates from different nations.

RBI Decided to Set Up 2 Billion Dollar Swap Facility For SAARC Nations

Reserve Bank of India (RBI) on 16 May 2012 decided to set up a 2 billion dollar swap facility for SAARC nations. This facility will be available in foreign currency and Indian rupee. The facility will provide the member nation with the facility to swap US dollar, euro or Indian rupee against domestic currency or domestic currency denominated Government securities. The withdrawal could be done in multiple tranches. The move for a SAARC swap facility follows a decision taken by the SAARC finance minister at the ministerial meeting on global financial crisis.

Retrospective Amendment To I-T Act May Impact FDI In India        

The amendment to increase tax laws with retrospective effects passed by Parliament may impact inflows of foreign direct investment (FDI) into the country, a top Italian trade official said.

General Provident Fund Interest Rate Hiked to 8.8%   

The Finance Ministry has hiked interst rates on General Provident fund to 8.8% a year with effect from April 1st this year. This move will benefit millions of employees.who are subcribes to this fund.berfore it is 8.6 in december 2011-March 2012.

Fix NPAs, Pranab tells to Banks

Finance Minister Pranab Mukherjee on 28 May asked  banks to take steps to manage their non-performing assets (NPAs). which have grown on account of economic down turn.NPAs of public sector banks stood at about 3.3 percent of the assets in 2011-12 as against 2.3 percent a year ago said pranab.

Delhi Chief Minister Sheela Dikshit Presented the Budget for Fiscal Year 2012-13

Delhi Chief Minister Sheela Dikshit on 28 May 2012 presented the financial budget in the Delhi assembly for the fiscal year 2012-13. The 33436 crore rupees budget had its share of populist measures as a number of social welfare schemes were announced in the budget by the government.