Tag: Nirmala Sitharaman

Failure at NSE clearing arm led to Feb outage, says RBI – Times of India

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MUMBAI: In a revelation, the RBI on Friday said that shutting down of the system at NSE Clearing (NCL) had led to the day-long trading blackout at the bourse on February 24.
Since the trading halt on NSE, the country’s largest exchange, it was believed that the trouble originated at two telecom service providers that led to stoppage of trading. The trading session was extended by one and half hours till 5pm to mainly help investors limit their losses after consultations among the government, Sebi, NSE and BSE, depositories and clearing corporations.
The major issue was the ineffectiveness of interoperability because of shutting down of the NCL, the RBI said in its ‘state of the economy bulletin’. “While NSE’s trades are cleared by NCL, trades on the BSE are cleared through Indian Clearing Corporation. In 2018, Sebi had announced interoperability between these two clearing corporations to help brokers consolidate their clearing and settlement functions at a single clearing house, irrespective of the stock exchange on which the trade is executed,” the central bank said in the report.
During the February 24 trading outage, NSE said that it had “multiple telecom links with two service providers to ensure redundancy and we have received communication from both the telecom service providers that there are issues with their links due to which there is an impact on the NSE system”.
“Another important failure was the inability to switch operations to the disaster recovery site,” the RBI said. “Robust risk management system encompassing disaster management and recovery are essential components for the smooth functioning of a stock exchange,” it noted.
The central bank also flagged that according to brokers, timely communication and clarification (from the NSE) could have averted the panic selloff by online traders on the BSE and prevented huge losses to investors.
Allowing Nifty and the sensex to trade on all the stock exchanges, extension of interoperability to include usage of trading infrastructure of another exchange and allowing entry of more exchanges to increase competition may need to be considered, besides focusing on strengthening of risk management frameworks at the exchanges,” the RBI noted.
A day after the NSE’s trading blackout, Association of National Members of India, a pan-India association of brokers had suggested that contracts on Nifty and the sensex should be allowed to be traded on both the leading bourses of India. Currently, while Nifty is traded only on the NSE, the sensex is traded only on BSE.
After the NSE blackout, finance minister Nirmala Sitharaman had said that it had cost the country and lessons were being learnt. Around the same time Sebi also set up a technical committee for a ‘root cause analysis’ of the failure.

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Advanced nations failed world on climate change: Nirmala Sitharaman

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Finance Minister Nirmala Sitharaman on Friday admonished advanced countries for failing to keep their financing commitments to help emerging economies cope with climate change, invoking the recent Uttarakhand disaster as an example of the vulnerabilities that need to be addressed.

The government, she said, was committed to building infrastructure that would not only revive the economy but also prove resilient to the risks of climate change. “We are looking at innovative systems that can certify [that] the resilience of the infrastructure is established. A global standard for certification for resilient infra is also something we are thinking of,” Ms. Sitharaman said at the International Conference on Disaster Resilient Infrastructure.

Arguing that advanced economies had failed to fulfil their ‘quantitative commitment’ to provide $100 billion a year to help smaller countries, she pointed out that this amount itself was ‘meagre’, to begin with.

“Financing for building resilient infrastructure, during the pandemic and after it, is a critical issue. Emerging economies or, worse, the small islands and countries in Africa, are going to have serious challenges in meeting the commitments of the Paris agreement. I appeal to the advanced economies that their commitment to financing climate change and transferring technologies which are important for achieving climate related goals will have to be ramped up, sped up and scaled up,” she said.

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FM Urges Advanced Economies to Scale Up Climate Change Financing Commitments

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FM Nirmala Sitharaman presents Budget 2021

FM Nirmala Sitharaman presents Budget 2021

She said India has announced a National Infrastructure Pipeline (NIP) consisting of nearly 7,000 projects and the government has adopted the route of reviving the economy through building infrastructure.

  • PTI
  • Last Updated:March 19, 2021, 20:48 IST
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Finance Minister Nirmala Sitharaman on Friday urged advanced economies to scale up their climate change financing commitments and help emerging countries build climate resilient infrastructure. She said India has announced a National Infrastructure Pipeline (NIP) consisting of nearly 7,000 projects and the government has adopted the route of reviving the economy through building infrastructure.

Sitharaman said the government is also looking at various routes for funding infrastructure, including by way of infrastructure debt fund or national bank for funding infrastructure, which would be taken up by Parliament soon. Speaking at the International Conference on Disaster Resilient Infrastructure (ICDRI), the finance minister said natural disasters remind everyone of the risks that infrastructure faces and the vulnerabilities of countries due to climate change.

“I … appeal to the advanced economies that commitment to financing climate change, transferring technologies, which are important for achieving climate related commitments and goals, will have to be ramped up, speeded up and scaled up. “Climate finance requirements are at the core of everything that we do in building a resilient infrastructure,” Sitharaman said.

She noted that multilateral institutions have played a very critical role in climate change financing and the developed countries have an obligation under the UN Framework Convention on Climate Change (UNFCCC) to provide funds to developing nations. “It is required of developed countries to understand that the commitment made under the UNFCCC will have to be honoured. “The quantitative commitment of USD 100 billion a year is something that advanced economies will have to recognise and that amount is itself … is a meagre amount and has to be ramped up,” Sitharaman said, adding that even that commitment is not being fulfilled.

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Morning Digest: Roads to be freed of toll booths in a year, says Nitin Gadkari; EU drug regulator backs AstraZeneca vaccine against COVID-19 after safety investigation, and more

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India will implement a GPS-based toll collection system and do away with all toll booths within a year, Union Minister for Road Transport and Highways Nitin Gadkari informed the Lok Sabha on Thursday. He also shared details of the vehicle scrapping policy, first announced in the Union Budget for 2021-22, according to which the automobile industry in India will see a jump in turnover to ₹10 lakh crore from ₹4.5 lakh crore.

Chief Justice of India Sharad A. Bobde agreed with advocate Prashant Bhushan on Thursday to urgently hear a plea by NGO Association for Democratic Reforms to stay the sale of a new set of electoral bonds on April 1, before Assembly elections in crucial States such as West Bengal and Tamil Nadu.

Top U.S. and Chinese officials offered sharply different views of the world on March 18 as the two sides met face-to-face for the first time since President Joe Biden took office. In unusually pointed remarks for a staid diplomatic meeting, Secretary of State Antony Blinken and Chinese Communist Party foreign affairs chief Yang Jiechi took aim at each other’s policies at the start of two days of talks in Alaska.

The EU’s drug watchdog said on March 18 it is still convinced the benefits of AstraZeneca’s COVID-19 vaccine outweigh the risks following an investigation into reports of blood disorders that prompted more than a dozen nations to suspend its use.

The Rajya Sabha on Wednesday passed the Insurance Amendment Bill 2021 that increases the maximum foreign investment allowed in an insurance company from 49% to 74%, amid criticism from the Opposition parties on the clause enabling “control and ownership” by foreign investors.

The Supreme Court on Wednesday forbade judges from making gender stereotypical comments like “’good women are sexually chaste”, women who drink and smoke ‘ask’ for sexual advances or presume that a sexually active woman consented to rape while hearing cases of sexual offence.

Union Communications and Information Technology Minister Ravi Shankar Prasad said on Thursday that climate activist Disha Ravi’s arrest was based on law and order and it is under judicial process. He added that the House should consider “should some people abuse social media internationally to defame India to promote secessionism.”

Former Chief Economic Advisor (CEA) Arvind Subramanian resigned from Ashoka University on Thursday, days after noted columnist and political commentator Pratap Bhanu Mehta’s exit. In his resignation letter, Dr. Subramanian, said he had been “devastated” by “the circumstances involving the ‘resignation’ of Professor Pratap Bhanu Mehta” two days earlier.

In a major embarrassment to the Bharatiya Janata Party (BJP), two candidates announced by the party on Thursday for the Assembly polls from Kolkata have refused to contest on the party’s ticket.

The Supreme Court on Thursday stayed suo motu proceedings before the Delhi High Court on the administration of COVID-19 vaccine and transferred the case to itself. A Bench led by Chief Justice of India Sharad A. Bobde said a similar case concerning the vaccination drive was already pending in the Supreme Court, and the case from the Delhi High Court could be heard along with it.

The Supreme Court on Thursday agreed to urgently hear a plea to release and protect over 150 Rohingya refugees reportedly “detained” in Jammu. Chief Justice of India S.A. Bobde agreed to hear the application filed by a member of the Rohingya community, Mohammad Salimullah, represented by advocates Prashant Bhushan and Cheryl d’Souza, on April 25 (Thursday). Mr. Bhushan made an oral mention before the CJI for an early hearing.

The Lok Sabha on Thursday passed the supplementary demand for grants (second batch for 2020-21) but not before significant concerns raised by Opposition leaders on the government’s disinvestment and asset monetisation plans, and rising fuel prices.

If Ishan Kishan was unfortunate to be ruled out of the fourth T20I due to a groin strain, lady luck smiled on his replacement Suryakumar Yadav. The Mumbai cricketer, dropped for the previous outing after not having faced a ball on his debut in the second T20I, grabbed his chance and made it count.

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Rajya Sabha Passes Bill to Raise FDI in Insurance to 74%, Sitharaman Says Resident India to Head Key Positions

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New Delhi: Rajya Sabha on Thursday approved a bill to raise the foreign investment limit in the insurance sector to 74 per cent with Finance Minister Nirmala Sitharaman saying while control will go to foreign companies, the majority of directors and key management persons will be resident Indians who will be covered by law of the land. “The laws of the land are fairly mature. They can control every operation which happens in this country. (No one can) take it (money) away and make us sit and watch,” she said replying to a debate on the bill.

Giving out reasons for the decision to raise the foreign direct investment (FDI) limit, she said insurance companies are facing liquidity pressure and the higher limit would help meet the growing capital requirement. On change of definition of ‘control’ of the insurance company with the hike in FDI limit, she said control means right to appoint a majority of directors, control the management of policy decisions including by virtue of their shareholding or management right or shareholder agreements or voting agreements.

FDI limit to 74 per cent, the current provision of control being vested with Indian companies had to be dropped. But conditions have been attached to the control.

“Majority of directors in the board and key management persons to be resident Indians which means every law of the land will be applicable on them. And a specific percentage of the profits is to be retained as general reserves. It cannot be (taken away),” she said. These conditions, she said, should remove doubts that higher FDI would bring colonialism.

Replying to a debate on the Insurance (Amendment) Bill, 2021, Sitharaman said India received FDI worth Rs 26,000 crore in the insurance sector after 2015 when the foreign investment limit was raised to 49 per cent from 24 per cent. The bill to hike the FDI limit in insurance, she said, was been brought after extensive consultations by sector regulator IRDAI.

The bill, which will now go to the Lok Sabha for approval, was passed by voice vote after opposition Congress and other parties staged a walkout in protest of the bill. They had forced four brief adjournments of the proceedings when the bill was taken up for discussion over their demand for it being referred to a Select Committee of the House for greater scrutiny.

The bill seeks to increase the FDI limit in the insurance sector to 74 per cent. The announcement regarding it was made by the minister while presenting the Union Budget on February 1. Currently, the permissible FDI limit in life and general insurance stands at 49 per cent, with ownership and management control with Indians.

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Mallya, Nirav Modi & Mehul Choksi all coming back to face law: FM Sitharaman – Times of India

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NEW DELHI: Finance minister Nirmala Sitharaman on Thursday said that fugitive businessmen Vijaya Mallya, Nirav Modi and Mehul Choksi are “coming back” to India” to face the law.
The government is pursuing the extradition of Mallya and Modi from the UK while Choksi is believed to be in Antigua.
Vijay Mallya, Nirav Modi, Mehul Choksi are all coming back to face law of the land, Sitharaman said in the Rajya Sabha while replying to a debate on the insurance amendment bill.
Mallya, an accused in bank loan default case of over Rs 9,000 crore involving his defunct Kingfisher Airlines, is in the UK since March 2016.
Nirav Modi and his maternal uncle Choksi fled the country allegedly after committing fraud in the public sector lender Punjab National Bank. Modi is accused of committing a fraud of USD 2 billion (around Rs 14,500 crore) in the PNB.

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Permission for new private banks to participate in government business will be based on RBI guidelines: FM

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Nirmala Sitharaman, during the Question Hour in the Rajya Sabha, said, “the RBI, being a regulator, has established norms and those norms will be applicable to the new banks.”

Finance Minister Nirmala Sitharaman on Tuesday said in Parliament that permission to new private banks for conducting government-related business will be given under the RBI guidelines.

Ms. Sitharaman, during the Question Hour in the Rajya Sabha, said the government has now “only indicated” the RBI to allow other private banks to perform government-related business to ensure there is a level playing field.

“Now, following the existing norms based on which several banks have been given permission to do the business. So, those rules as per the RBI guidelines be applied on newer banks and new private banks which approach the RBI,” she said.

The RBI, being a regulator, has established norms and those norms will be applicable to the new banks, she added.

The Minister was responding to a query about whether the government will adopt any criteria to permit new banks for taking up government-related business.

Responding to another query by Shiv Sena leader Anil Desai that if public sector banks will weaken by allowing private banks to conduct government-related business, Ms. Sitharaman said some private banks and all public sector banks are doing this.

“Some customers are already benefiting from private banks from such services. The attempt now is to bring a level-playing field. Some private banks are already doing, all public sector banks are doing, why not extend to all private sector banks so that everybody gets an equal opportunity,” she explained.

This is being done because the business is growing and many more citizens are approaching the banks. As it was highlighted, the ease of doing business will have to be extended to all customers, she said.

Minister of State for Finance Anurag Singh Thakur said banks handle two kinds of businesses. One is the agency commission under which revenue receipts and payments on behalf of the Central and State governments and pension payments in respect of the Centre and State governments or any other item advised by the RBI is carried.

On the other hand, certain items fall under the work, which does not have the agency commission, but that has to be done by the bank such as furnishing of the bank guarantees and banking business, etc.

Stating that there is an increase in the share of private banks in the banking sector, Mr. Thakur said the deposit of the private banks has increased from 12.63% in 2000 to 30.35% now. The advances, too, have increased from a mere 12.56% to 36% now.

That apart, the share of the private sector in priority sector lending is rising. The private banks have given loans of ₹12.72 lakh crore, which is close to 50% of the priority sector lending.

During the COVID-19 period, private bank participation in the government’s emergency credit line guarantee scheme has gone up.

Under the scheme, the cumulative sanction from public sector banks was ₹95,261 crore, which was 38.22% of total lending. On the other hand, private sector bank lending was ₹1,28,297 crore, which was 51.5% lending of the emergency credit guarantee scheme. This clearly shows that the lending has gone up and their participation is more, he said.

Therefore, the decision to allow the private banks to undertake government-related business was taken for the betterment of consumers, ease of business and ease of living, he said, adding that this will enhance customer experience, enable innovation and latest technology that will help the business community and MSMEs.

“It will also lead to a spur of competition for higher efficiency,” the Minister added.

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FM Sitharaman Defends Bank Privatisation Amid Strike

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Amid strikes by bank unions against privatisation, Finance Minister Nirmala Sitharaman on Tuesday said the government would ensure protection of employees’ interests even after the banks are privatised.

“It’s not right to say that every government bank is being sold-off. We will absolutely be protective of employees who have given decades to these banks…their salary, their pensions will be protected,” she said.

Banking operations across the country are partially hit as the United Forum of Bank Unions (UFBU) has called a nationwide strike to protest against the proposed privatisation of two state-owned lenders. The strike comes about a month after Finance Minister Nirmala Sitharaman, while presenting the Union Budget, announced the privatisation of two public sector banks (PSBs) as part of the government’s disinvestment plan.

The government has already privatised IDBI Bank by selling its majority stake in the lender to LIC in 2019 and has merged 14 public sector banks in the last four years. Conciliation meetings – before the Additional Chief Labour Commissioner on March 4, 9 and 10 – did not yield any positive result, so the strike stands, All India Bank Employees Association (AIBEA) general secretary CH Venkatachalam had said.

Members of UFBU include All India Bank Employees Association (AIBEA), All India Bank Officers’ Confederation (AIBOC), National Confederation of Bank Employees (NCBE), All India Bank Officers’ Association (AIBOA) and Bank Employees Confederation of India (BEFI) are on strike. Others are Indian National Bank Employees Federation (INBEF), Indian National Bank Officers Congress (INBOC), National Organisation of Bank Workers (NOBW) and National Organisation of Bank Officers (NOBO).

Meanwhile, Sitharaman also hit out at Congress leader Rahul Gandhi, saying privatising tax payers’ money was what UPA had been doing. “The taxpayers money was being used for ‘one family’ only,” she said.

The Congress on Tuesday had asked the government to accept the demands of the nine unions of public sector banks (PSBs) that are on a two-day strike to protest privatisation of two PSBs, and accused the Centre of working for the benefit of a few “crony capitalists”. Gandhi alleged that selling public sector banks to “cronies” will compromise the country’s financial security.

He also accused the government of “privatising profit” and “nationalising loss”. Public sector bank employees began their two-day strike on Monday, employees of general insurance companies will strike on March 17, and Life Insurance Corporation (LIC) employees have given a strike call on March 18, Leader of the Opposition in Rajya Sabha and senior Congress leader Mallikarjun Kharge said.

“Despite so many people going on strike and protesting the policy of privatisation, the government is neither listening to them nor looking to solve their problems. The government has taken a decision to privatise two public sector banks without consulting the 75 crore account holders,” Kharge told reporters outside Parliament.

He said top 14 banks were nationalised by former prime minister Indira Gandhi so that the poor and small and medium businesses can make use of them. “By merging all these banks one by one, they (the government) are trying to put them in losses and then make the private players enter by citing losses,” said Kharge, flanked by party MPs Shaktisinh Gohil and Syed Nasser Hussain. The government wants to hand over the country’s wealth to a few by privatising nationalised banks, he alleged. He said out of the 13 lakh bank employees, there are several people from poor sections of the society, from the SC, ST and OBC categories who are also being “betrayed”.

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DFI in India: Cabinet clears proposal to set up development finance institution, says Nirmala Sitharaman | India Business News – Times of India

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NEW DELHI: The Union Cabinet on Tuesday approved the creation of a development financial institution (DFI) for financing infrastructure and development activities in the economy.
Briefing the media after the Cabinet meeting, finance minister Nirmala Sitharaman thanked Prime Minister Narendra Modi for his gentle nudge to set up the DFI as announced in Budget 2021.
“Past attempts to have alternative investment funds were taken up, but for various reasons, we ended up with no bank which could take up long-term risk (which is very high) and fund development,” she said.
The DFI will help raise long-term funds. It will have a professional board and at least 50 per cent of the members will be non-official directors.

The institution will be set up on a capital base of Rs 20,000 crore and will have lending target of Rs 5 lakh crore in three years.
Its initial grant will be Rs 5,000 crore and additional increments of grants will be made within the limit of Rs 5,000 crore.
“I expect the institution to raise up to Rs 3 lakh crore ($41.36 billion) in the next few years,” the minister added.
In her Union Budget for 2021-22 presented on February 1, Sitharaman had proposed to allocate Rs 20,000 crore for setting up a development finance institution, with a view to partly fund proposed $1.5 trillion in infrastructure projects over the next few years.
The DFI will initially start with a government ownership of 100 per cent and gradually with time it would come down to 26 per cent, but not below it, Sitharaman said.

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Nirmala Sitharaman: Funds under MPLADS for 2019-20 cleared | India Business News – Times of India

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NEW DELHI: Finance minister Nirmala Sitharaman on Tuesday said in the Rajya Sabha that fund under the Members of Parliament Local Area Development Scheme (MPLADS) for 2019-20 have been cleared.
TRS MP B Lingaiah Yadav had raised the matter during the Zero Hour in the House.
Responding on the issue, Sitharaman said several MPs from different parties had made representation on the matter.
“It is well known that for 2020-21 and 2021-22 the decision had been taken that no new commitments for MPLADS will be made, and, therefore, no allocation will be made,” she said.
The minister further said that whatever commitments have been made for the year 2019-20 will be honoured.
“I have cleared the file on it…For 2019-20, the year before the corona thing happened, every commitment, which has been made by honourable MPs will be fulfilled. However, as was the instruction or as was the notification made for the year 2020-21 and for the year 2021-22 no new commitments on MPLADS will be entertained,” she said.
Sitharaman said money has been cleared from the ministry of finance and the ministry of statistics and programme implementation (MoSPI) has assured her that they will be immediately sending the money to the districts.
MPLADS funds for 2019-20 have been cleared for MPs from both the Lok Sabha and the Rajya Sabha.
Under the scheme, each MP has the choice to suggest to the District Collector for works to the tune of Rs 5 crore per annum to be taken up in his/her constituency.
The Rajya Sabha Members of Parliament can recommend works in one or more districts in the State from where he/she has been elected.

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