1. Airfares Set to Rise with Increase in Passenger Service Fee
Flying is about to get more expensive in India as the government has decided to raise the Passenger Service Fee (PSF) to Rs 170 from Rs 135 to meet the rising cost of airport security, which is provided by the Central Industrial Security Force (CISF).
“This increase will be enough to meet the cost of securing airports across the country for another three years and also clear the dues,” said an aviation ministry official. Delhi airport owes about Rs 800 crore to CISF, prompting a threat to curtail its services in August.
The decision to raise PSF, unchanged since 2001, was taken after the Prime Minister’s Office (PMO) asked the finance ministry to look into the matter.
“The mandate to raise PSF to meet the cost has gone to the finance ministry now,” the official said. “It has been asked to raise PSF at regular intervals to ensure that costs are met.”
(Source: The Economic Times)
2. RBI to Soon Release New Rs 20 Bank Note
The Reserve Bank of India (RBI) will soon introduce a new Rs 20 currency note with additional features, according to a document of the central bank.
The central bank has already issued new look currency notes in the denominations of Rs 10, Rs 50, Rs 100, and Rs 500, besides introducing Rs 200 and Rs 2,000 bank notes.
The new look notes are being introduced since November 2016 under Mahatma Gandhi (New) series. These are different in size and design compared to the notes issued previously.
According to the RBI data bank, there were 4.92 billion pieces of Rs 20 note in circulation as on 31 March 2016. The number more than doubled to about 10 billion pieces by March 2018.
The Rs 20 notes accounted for 9.8 percent of the total number of currency notes in circulation at the end of March 2018.
3. Bank Strike on 26 Dec, Services to Be Affected
Services of state-owned banks are expected to be impacted on Wednesday, 26 December, due to a nation-wide strike call given by unions to protest against the proposed amalgamation of Vijaya Bank and Dena Bank with Bank of Baroda.
This will be the second bank strike in less than a week. Most of the banks have already informed customers about the strike. Private sector banks will continue to function as usual.
The strike is being organised by the United Forum of Bank Unions (UFBU), an umbrella organisation of nine unions, including the All India Bank Officers Confederation (AIBOC), the All India Bank Employees' Association (AIBEA), National Confederation of Bank Employees (NCBE) and the National Organisation of Bank Workers (NOBW).
According to AIBEA General Secretary C H Vekatachalam, the conciliation meeting called by Additional Chief Labour Commissioner did not lead to any assurance and so the unions are going ahead with the strike.
4. Northern Arc Raises Rs 200 Crore Debt from Dutch Bank FMO
Northern Arc Capital, which lends to impact-focused companies and also facilitates debt financing, has raised Rs 200 crore from Dutch development bank FMO via rupee denominated non-convertible debentures (NCDs), said a senior executive.
Established in 2008, Northern Arc Capital connects non-banking financial companies (NBFCs) working among financially excluded households and businesses with investors in existing and emerging debt capital markets.
The funds will be issued in two tranches of Rs 100 crore each. One tranche has been classified as “green bonds”, said Kshama Fernandes, chief executive and managing director, Northern Arc Capital. Green bonds are bonds earmarked to be used for environmental and climate-related projects.
5. Indian Oil May Drop Plan to Buy Stake in Mundra Terminal
State-run Indian Oil Corp Ltd (IOCL) may drop its plan to acquire as much as 50 percent stake in the Mundra LNG terminal in Gujarat, officials said. In August 2017, Indian Oil said it has received an in-principle approval from its board to buy a 50 percent stake in the 5 million tonnes per annum terminal (mtpa) for around Rs 750 crore.
The Rs 5,000 crore project is being built by GSPC LNG Ltd, a unit of Gujarat State Petroleum Corp Ltd (GSPC).
“IOCL recently informed GSPC LNG that it would not like to go ahead with its plans of picking up a stake in the terminal,” said a Gujarat government official.
While one of the main reasons cited by Indian Oil is that a concession and sub-concession agreement between the special purpose vehicle, GSPC LNG, and maritime regulator Gujarat Maritime Board is yet to be signed, the expenditure made towards the port and port-led development is another stumbling block for the refiner, an official said.
(Source: Hindustan Times)
6. Group of State FinMins May Propose Raising GST Threshold
A group of state finance ministers might recommend raising the turnover threshold for the goods and services tax (GST) from the current Rs20 lakh to Rs75 lakh, in a move that would give lakhs of micro and small enterprises the option to be outside the ambit of GST.
Bihar Deputy Chief Minister Sushil Kumar Modi, who is a member of the group, told FE that a proposal to raise the exemption threshold was found to be more practical than tax refunds in providing relief to MSMEs.
Modi – who holds the finance portfolio in the state and has been a key member of many GST-related panels over the last two-three years – also said a composition scheme similar to existing ones for traders and manufacturers could be made available for small services providers.
The annual revenue limit for it could be between Rs 50 lakh and Rs 1 crore.
(Source: The Indian Express)
7. Petronet LNG to Invest Rs 2,100 Crore at Dahej Terminal
Petronet LNG Ltd, India’s top gas importer, plans to invest Rs 2,100 crore to expand its terminal capacity in Dahej, Gujarat, from 15 million tonnes per annum (MTPA) to 20MTPA in the next two or three years, said two officials close to the development. Of the total, Rs 1,300 crore would be used to expand the Dahej terminal, while Rs 800 crore will be spent on building LNG storage tanks, they said, requesting anonymity.
Petronet LNG, which built India’s first LNG receiving and regasification terminal at Dahej, operates another terminal in Kochi.
The Kochi terminal has a capacity of 5 MTPA. The company is in the process of building a third terminal, at Gangavaram, Andhra Pradesh.
An investment proposal for the expansion in Dahej has been recently submitted to the Gujarat Maritime Board — the regulator for all the non-major ports and maritime activities in Gujarat, confirmed a senior Gujarat government official.
8. PVR Cinemas Lines Up Fresh Investment of up to Rs 3k Cr
At a time when Netflix, Hotstar and Amazon Prime are becoming the buzzwords for TV and film content in India, PVR – the country’s largest multiplex screen owner remains unfazed and is rather preparing for an investment and expansion onslaught.
The Ajay Bijli-owned company, which runs nearly 750 cinema screens across the country, is planning to go full throttle and is gearing to add as many as 800-1,000 new screens over the next 3-4 years.
“We plan to invest Rs 2,500-3,000 crore for this expansion, and this will be managed through a mix of cash and debt,” Gautam Dutta, CEO of PVR Cinemas, said.
“The investments that we are lining up now are more than the estimated Rs 2,000 crore capital that we have deployed over the last two decades,” he added.
(Source: The Times of India)
9. Vedanta to Set up 4.5-Mt Steel Plant in Jharkhand
Natural resources major Vedanta Ltd on Tuesday, 25 December, said it will set up a new steel plant in Jharkhand with a capacity of 4.5 million tonne (MT) per annum at an investment of USD 3-4 billion.
The plant will be part of the company's newly-acquired Electrosteel Steels Ltd (ESL) at Bokaro, Vendanta Resources Chairman Anil Agarwal told reporters.
"This would be a new steel plant under ESL and in the same location at Bokaro... so it's a brownfield investment per se. The amount is likely to be to the tune of USD 3-4 billion for a capacity of 4.5 MT," Agarwal said.
The plant would create 1,20,000 jobs in the form of direct and indirect employment, Agarwal said.
In March, Vedanta was declared as the successful resolution applicant for ESL under the corporate insolvency resolution process. The company has acquired control of ESL through its wholly-owned subsidiary Vedanta Star Ltd, and a new board of directors has been put in place.
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