Set up under the insolvency and Bankruptcy Code, Insolvency and Bankruptcy Board of India (IBBI) is the regulator for insolvency professionals, insolvency professional agencies, insolvency proceedings and other related parties, The board is responsible for implementation of the code in India. Set up in October 2016. IBBI came into prominence mainly because of the growing pile of non-performing assets in the banking sector, a large part of which has been referred under the code. IBBI has the powers to write and enforce rules for bankruptcy transaction involving corporates as well as individuals. currently the board has eight members with M.S Sahoo as the chairperson.
There has been lot of resistance to the government's move to introduce e-way bill under the GST with most transporters opposing it. These bills are receipts that the sender of a consignment with a value of more than Rs 50,000 should generate from the GST portal and send along with the consignment to the recipient. Although yet to be introduced, a consignment will become invalid if it's not accompanied by one suct bill. E-Way bills will have validity (for a specified number of days) depending upon the distance that the consignment will travel. For example, an e-way bill for up to 100 kms will have a validity of one day while for a distance of more than 1,000 kms or more, the validity is 15 days
Cash Reserve Ratio (CRR) is the stipulated minimum percentage of the total deposit base of a bank that it has to maintain with the central bank to meet any unforeseen large customer withdrawals. The amount specified by CRR is held as cash or deposits with the central bank which could be used in case of an emergency cash requirement. In India, the Reserve Bank of India (RBI), like all other key policy rates and ratios, also sets the CRR which is currently at 4%. Lately, there has been talk of the RBI cutting CRR in its policy review meeting on Tuesday to help banks cut their lending rates. Globally, central banks use CRR as a monetary policy tool. In situations when there is excess liquidity in the banking system, central banks hike CRR to suck out some extra liquidity. They cut CRR in situations where the system is short on liquidity as a cut releases some extra liquidity into the system. Since changes in CRR lead to changes in the system liquidity, it also can be used to influence the rate of interest banks charge to their borrowers.
The Index of Industrial Production (IIP) is the leading measure of robustness in the industrial sector in India. Measured as an index number of several sectors like mining, manufacturing, power, etc, the yearly and monthly percentage changes of the numbers indicate how the country's industrial sector is performing. Around the 15th of every month, the IIP number is published by the Central Statistical Organisation for the month that ended six weeks before. As the composition of the industrial sector in India changed over time, the industries and their weight in the IIP also changed. When the changes were too varied, the base year -the year for which the IIP number was 100 -was also changed. The current base year is 2004-05.
Days back SEBI asked all listed companies to report any default in payment on loans to banks, NBFCs or any other financial institution within a day of such a default. So far listed companies were required to disclose only the defaults on non convertible debentures and other listed instruments which are regulated by Sebi. Aiming towards more transparency and protection of investors, the regulator has expanded disclosure requirements for loans for lenders as well. Sebi also wants listed companies to inform investors if a company is referred to under the insolvency and Bankruptcy code which allows lenders to take the company to the insolvency and Bankruptcy Commission within a day of the default.
Several large companies have announced buyback of their shares, returning money to shareholders as a one-time process, instead of paying dividend. Under a share buyback plan, the company announced to take back its own shares from its shareholders and pay them money, Company's promoters may or may not decide to participate in the programme. The buyback takes place through the stock exchange platform and company-appointed merchant bankers manage the whole process. After the buyback programme is over, since there are less stocks of the company available in the market while its fundamentals remain the same. the stock price usually rises, the lure of stock price appreciation in future. prompts some shareholders to not participate in the buyback programme.
Since late 2008, the US Federal reserve, its central bank, has been buying bonds from the market to infuse money into the system. Currently it has assets worth more than$4 trillion, Which is nearly double the size of India's GDP. This was done to stabilize the economy after the financial crisis which had entered a phase of recession. Now that the US economy is firmly on a growth path, the US Fed recently announced that starting October, It will start paring its assets. This means it would slowly sell the bonds that it had accumulated since late 2008. This is being done on the premise that a growing economy will now be able to sustain itself and will not need the US central bank to infuse money into the system.
It was IFC. the private investment arm of the World Bank which used the term Masala bonds for fixed income instruments issued by Indian companies. Masala bonds are debt instruments issued by Indian corporates in foreign markets but are denominated in Indian rupee. so in effect the currency risks on these bonds are borne by the investors rather than the issuing Indian companies in comparison, If an Indian company issues dollar denominated bonds in the foreign market on which the currency risks are borne by the issuer, those bonds are called dollar bonds. The first Masala bond was issued by IFC , followed by housing finance major HDFC.
Recently the government changed the rules for investments in public provident fund (PPF) or national savings certificates (NSC) by non-residents Indians (NRIs). Indian investors in PPF and national savings certificates NSC will not get the government mandated high rates of return in these schemes once they become NRIs. Once they turn NRIs, the rates of return in these schemes will be equal at post office savings account rate. Both PPF and five-year NSC currently earn 7.8% annual rate of return while post office savings account rate is 4%, PPF and NSC rates are also higher than what banks offer in comparable products. The same will also be applicable for all those existing PPF and NSC investments by NRIs.
Under the anti-profiteering rule, it's mandatory for sellers of goods and services to pass on the benefits of lower tax rates and input tax credits to consumers. if they don't do this with the intentions of higher profits, they could face penal actions. anti-profiteering rules have been put in place to protect retail consumers from inflation due to GST. For example, after the recent reduction in GST for hotels and restaurants, eating out has become cheaper. To ensure restaurants pass on the benefits of lower rates. even government officials are being deployed on the field. These rules have been put in place after studying the launch of such tax regimes in other countries where in some cases it led to priceraise.
To boost the habit of savings and investments, the government has allowed every individual taxpayer to invest and buy certain financial products which will allow them to avail of tax deductions, under section 80C of income tax act 1961, a taxpayer could invest a total if Rs. 1.5 lakh per annum in ELSS of mutual fund houses. EPF , PPF tax-savings FDs, NPS, life insurance products and some other approved financial products which will reduce the person's total tax liability. payment of home loan principal and tuition fee of children also come under this section for tax deductions.
A Yield on a bond is the rate of return that you can get if you buy a bond from the market and hold it till the date of payment of the rate of interest which is usually per determined. Often bonds pay a fixed rate of interest at a quarterly, half yearly or yearly basis. As the p rice of the same bond varies, the effective rate of return, which is the yield, that you would get would also vary, in case you hold the bond till it matures, then the yield that you would get at the end is called the yield to maturity also it should be noted that the p of the bond and they yield on the same are related.
