India takes baby steps to gold-linked products

[email protected] (Naeem Siddeeq)
February 3, 2013
Mumbai, Feb 3: The Reserve Bank of India (RBI) plans to introduce three to four gold-linked products in the next few months, in an effort to bring 20,000 tonnes of gold held in households into the banking system, but the measure is unlikely to cut bullion imports sharply, a senior official said.

India is the largest importer of gold, which is its second biggest import item after oil and contributes around 10 per cent to the total import bill.

Large gold imports are a worry for the government and the RBI, with the current account deficit shooting to a record high in the September-quarter, pressuring the rupee and adding to inflationary pressures.

The RBI plans to mobilise the unused gold by lending it to importers and exporters of the yellow metal, in a move it hopes will bring down the demand for physical gold.india

It wants banks to encourage products linked to accepting physical gold as deposits, invest public money in gold related products, and extend loans against gold as collateral.

Indians own about 20,000 tonnes of gold, or three times the holdings of the US Federal Reserve, in jewellery, bars and coins.

“Overnight there won't be any reduction in imports, but people need to be made curious about new products,” the RBI official with direct knowledge said. “The main conduits of gold imports are banks, forming 50-60 per cent of the total imports and supplies to jewellers. The way banks are suffering from huge NPAs (non-performing assets), this is a good product to work on."

The RBI is likely to release its final report on issues related to gold imports and gold loans mid-next week, the official said.

The RBI is designing products that could replace physical gold demand to yield similar returns, with easy liquidity, and documentation.

Indian banks' total gold loans are worth Rs 1 trillion.  Manappuram Finance and Muthoot Finance, two of the top gold loan financing institutions, together have loan books of Rs 500 billion, the official said, indicating a large business opportunity.

"The problem of gold imports can be solved only when the economy enjoys inflationary and macroeconomic stability," added the official.

Headline inflation has been above 7 per cent in the last three years, prompting savers to invest in gold, stocks and real estate, which yielded higher returns.

The RBI estimates gold imports to fall 25 per cent in 2012-13 to 750 tonnes from a record of 1,079 tonnes in the previous year due to high import duty, a jump in prices, slowdown in economic growth, and a month-long jewellers' strike.

India's current account deficit would had been lower by $6 billion at 3.9 per cent in 2011/12 instead of 4.2 per cent, had imports grown by an average of 24 per cent instead of 39 per cent, the RBI said in a recent report.

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News Network
January 27,2020

New Delhi, Jan 27: The government on Monday issued the preliminary information memorandum for 100 per cent stake sale in national carrier Air India. As part of the strategic disinvestment, Air India would also sell 100 per cent stake in low cost airline Air India Express and 50 per cent shareholding in joint venture AISATS, as per the bid document issued on Monday.

Management control of the airline would also be transferred to the successful bidder.

The government has set March 17 as the deadline for submitting the Expression of Interest (EoI).

EY is the transaction adviser for Air India disinvestment process.

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Agencies
March 22,2020

New Delhi, Mar 22: The exercise to update the National Population Register (NPR) and the first phase of the Census 2021, scheduled to begin from April 1, are likely to be deferred for an indefinite period due to Coronavirus pandemic, officials said.

A formal order on this effect is expected within a day or two.

Discussions are going on at the highest level of the government and in all probability, the NPR and house listing phase of the Census work will be deferred till the threat of the Coronavirus is over, a home ministry official said.

The exercise to update NPR and the housing listing phase of the Census is scheduled to be carried out across the country from April 1 to September 30.

Last week, the home ministry had said the preparation for the Census 2021 and updation of the NPR were at its peak and they will begin from April 1.

The ministry said this after a conference of the Directors of the Census Operations on status of preparatory work around Census 2021 and NPR updation.

There has been opposition from several state governments to the NPR and some of the assemblies even adopted resolutions expressing reservations on the exercise.

The states which have been opposing the NPR include Kerala, West Bengal, Punjab, Rajasthan, Chhattisgarh and Bihar.

However, most of them also said they will cooperate with the house listing phase of the Census.

The objective of the NPR is to create a comprehensive identity database of every usual resident in the country.

The database would contain demographic as well as biometric particulars, they said.

The notification for the house listing census and NPR exercise came recently amid furore over the contentious Citizenship Amendment Act (CAA).

The home ministry officials said most of the states have notified provisions related to the NPR.

The NPR is a register of usual residents of the country. It is being prepared at the local (village/sub-town), subdistrict, district, state and national levels under provisions of the Citizenship Act, 1955 and the Citizenship (Registration of Citizens and Issue of National Identity Cards) Rules, 2003.

The data for NPR was last collected in 2010 along with the house listing phase of the Census 2011. Updating of this data was done during 2015 by conducting door to door survey.

While updating the register in 2015, the government has asked details like Aadhaar and their mobile number.

This time, the information related to their driving licence and voter ID card may also be gathered, the officials said, adding that PAN card details will not be collected as part of this exercise.

Though information regarding the place of birth of parents will be sought, it is up to the residents whether to respond the question as it is voluntary.

For the purposes of the NPR, a 'resident' is defined as a person who has lived in a local area for the past six months or more, or a person who intends to reside in that area for the next six months.

The law compulsorily seeks to register every citizen of India and issue a national identity card.

The demographic details of every individual are required for every usual resident: name, relationship to head of household, father's name, mother's name, spouse's name (if married), sex, date of birth, marital status, place of birth, nationality (as declared), present address of usual residence, duration of stay at present address, permanent residential address, occupation, educational qualification.

The Union Cabinet has approved Rs 3,941.35 crore for the NPR exercise.

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News Network
July 26,2020

New Delhi, Jul 26: Union Home Minister Amit Shah on Sunday saluted the valour and grit of the Indian soldiers on the occasion of 21st anniversary of the 'Kargil Vijay Diwas'.

Shah took to Twitter and said that 'Kargil Vijay Diwas' is a symbol of India's proud, valour and steadfast leadership.

"Kargil Vijay Diwas is a symbol of India's proud, valor and steadfast leadership. I bow to the soldiers who, with their indomitable courage, drove the enemy from the inaccessible hills of Kargil and waved the tricolor there again. The country is proud of the heroes of India, who are dedicated to protecting the motherland," Shah tweeted (translated from Hindi)
The country is celebrating the anniversary of the 'Kargil Vijay Diwas'.

The Indian armed forces had defeated Pakistan on July 26, 1999. Since then, the day is celebrated as 'Kargil Vijay Diwas' to rekindle the pride and valour of the soldiers who took part in Operation Vijay.

The day marks the victory of Indian soldiers in recapturing the mountain heights that were occupied by the Pakistani Army on July 26, 1999, known as the Kargil War. 

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