Mumbai, Mar 27: The Reserve Bank of India (RBI) on Friday lowered the key repo rate by 75 basis points to 4.4 per cent in a bid to arrest the economic slowdown amid coronavirus (COVID-19) outbreak.
The reverse repo rate now stands at 4 per cent, down by 90 basis points, said RBI Governor Shaktikanta Das adding this has been done to make it unattractive for banks to passively deposit funds with the central bank and instead lend it to the productive sectors.
The six-member monetary policy committee (MPC) met on March 24, 25 and 27 and voted 4:2 in favour of the repo rate reduction. The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy while ensuring that inflation remains within the target.
"The need of the hour is to shield the economy from the pandemic," said Das. "We need to mitigate the impact of coronavirus, revive economic growth and provide financial stability."
Repo rate is the rate at which a country's central bank lends money to commercial banks, and the reverse repo rate is the rate at which it borrows from them.
The RBI Governor further said that the economic growth and inflation projection will be highly contingent depending on the duration, spread and intensity of the pandemic.
"Global economic activity has come to a near standstill as COVID-19 related lockdowns and social distancing are imposed across a widening swathe of affected countries. Expectations of a shallow recovery in 2020 from 2019's decade low in global growth have been dashed," said Das.
"The outlook is now heavily contingent upon the intensity, spread and duration of the pandemic. There is a rising probability that large parts of the global economy will slip into recession," he said.
However, the RBI has injected liquidity of Rs 2.8 lakh crore via various instruments equal to 1.4 per cent of GDP. "Along with today's measures, liquidity measures equal to 3.2 per cent of GDP. The RBI will take continuous measures to ensure liquidity in the system."
The RBI governor has said that all banking institutions can offer a three-month moratorium on all loans for a period of three months. The RBI has also allowed banks to restructure the working capital cycle for companies without worrying that these will have to be classified as a non-performing asset (NPA).
The three-month moratorium will permit banks to avoid a large onset of NPAs during the 21-day lockdown and keep their books healthy.
Das said banks and other financial institutions should do all they can to keep credit flowing to economic agents facing financial stress on account of the isolation that the virus has imposed.
"Market participants should work with regulators like the RBI and the Securities and Exchange Board of India (SEBI) to ensure the orderly functioning of markets in their role of price discovery and financial intermediation," he said.
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RBI reduces repo rate by 75 basis points to battle COVID-19 impact
News Network
March 27, 2020
Foreigners Who Visited China after January 15 Barred From India: Aviation Watchdog
News Network
February 9,2020
New Delhi, Feb 9: As the outbreak of novel coronavirus has lead to the death of more than 800 Chinese nationals, aviation regulator DGCA on Saturday said that foreigners who went to China on or after January 15 will not be allowed to enter India.
The DGCA, in its circular to airlines on Saturday, reiterated that all visas issued to Chinese nationals before February 5 have been suspended.
However, the Directorate General of Civil Aviation (DGCA) clarified, "These visa restrictions will not apply to aircrew, who may be Chinese nationals or other foreign nationalities coming from China."
"Foreigners who have been to China on or after January 15, 2020, are not allowed to enter India from any air, land or seaport, including Indo-Nepal, Indo-Bhutan, Indo-Bangladesh or Indo-Myanmar land borders," the DGCA said.
Among Indian airlines, IndiGo and Air India have suspended all of their flights between the two countries. SpiceJet continues to fly on Delhi-Hong Kong route.
On February 1 and 2, Air India conducted two special flights to Chinese city of Wuhan, epicentre of the outbreak, evacuating 647 Indians and seven Maldivians.
Till date, three Indians have tested positive for novel coronavirus.
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Crisis-hit Congress to shift its MLAs out of Madhya Pradesh
News Network
March 11,2020
Mar 11: In a bid to keep its flock together, the crisis-hit Madhya Pradesh Congress has decided to shift its 92 MLAs either to Jaipur or some other place.
The move comes after 22 Congress MLAs loyal to former Union minister Jyotiraditya Scindia resigned on Tuesday, pushing the 15-month-old Kamal Nath government to the brink of collapse.
"We are going to take our 92 MLAs and those supporting our Madhya Pradesh government to a hotel," a senior Congress leader said on Wednesday.
The legislators would be taken either to Jaipur or some other Congress-ruled state like Chhattisgarh, a party source said.
Apart from its own MLAs, the Congress is also keeping a close watch on four Independents who are supporting the party-led state government.
On Tuesday, 22 Congress MLAs from Madhya Pradesh resigned soon after Scindia quit the party.
The development reduced the Congress government in the state to minority.
The state Congress unit is now making all efforts to save the Kamal Nath-led government.
The BJP on Tuesday night shifted its MLAs to Manesar at Gurugram in Haryana, sources in the saffron party said.
The Congress, whose tally before the rebellion was 114, has a wafer-thin majority in the Madhya Pradesh Assembly whose current effective strength is 228.
It also has the support of four Independents, two BSP legislators and one SP MLA, but some of them are now likely to switch sides to the BJP.
The BJP has 107 seats in the state Assembly.
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Supreme Court to hear plea for FIRs against hate speeches leading to Delhi riots
News Network
March 2,2020
Feb 2: The Supreme court on Monday decided to hear on March 4 a plea seeking registration of FIRs against politicians for hate speeches which allegedly led to violence in the national capital.
A bench headed by Chief Justice S A Bobde agreed to hear the plea filed by riots victims.
The petition was mentioned for urgent listing by senior advocate Colin Gonsalves, appearing for the riots victims.
Gonsalves said that the Delhi High Court has deferred for four weeks the matters related to riots in the national capital despite the fact that people are still dying due to the recent violence.
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