The First Forum is an initiative which focuses on covering the latest happenings going around in the world in a brief format. This is in lieu with the importance of catching up with these events in this fast changing world.
In this Nineteenth Edition of The First Forum we would be covering the following:
1. Business
2. Economics
3. Finance

(By Gunika Vij, Somya Yadav and Manraj Uppal)


Retailers offer incentives to staff members to keep business functioning normally 
Leading retailers across the country have started providing their employees additional benefits to keep them working such as hardship allowance, transport and food arrangements. This measure is taken so that consumers do not face inconvenience. German wholesaler Metro Cash and Carry India is offering additional Rs500 with salary to all its employees. Read MoreThe union commerce minister Piyush Goyal has asked retail chains and e-commerce executives to motivate their employees except those who are in their native towns. While Delhi NCR, Maharashtra, Hyderabad and Bengaluru have taken steps to help their employees, markets in Uttar Pradesh, Punjab and Andhra Pradesh are showing resistance. 

America’s unemployment crisis 
Just about a month ago, when Coronavirus had not yet wreaked havoc in the USA, Elon Musk called the virus overrated. He stated that the panic was uncalled for and that the virus wouldn’t cause a major disruption in American businesses or life. He was emphatically wrong. About 3.3 million Americans have lost their jobs in one week. Read MoreThis has been a direct result of the shutdown of country clubs, restaurants, cinema halls, factories and gyms etc. Ian Sheperdson said that this is the worst data point that he has seen since 1996. This has brought to a decade-long expansion in jobs which had been taken to new heights by the Trump administration. To make it worse, analysts say that these numbers may actually be an under assessment considering that part-time contractual workers don’t figure in this data. Some companies like Amazon and Walmart have claimed that they will hire workers but analysts indicate that this won’t be able to compensate for everyone who’s lost their jobs. Moreover, once the crisis is done, there is no saying until when these people will remain unemployed considering that some sectors, like the aviation sector, may take months if not years to revive.

Trump signs largest bailout in US history
Donald has approved the largest bailout package in the history of the USA. He signed a monumental bill which passed without any opposition in the senate. This bailout package is worth 2.2 trillion dollars. The new law enables direct payment to households and companies which have been affected by the pandemic. Read MoreIt will deliver 1200 dollars to every American earning less than 75,000 dollars with an additional 500 dollars for every child. It also gives funds to state governments and increases benefits under the unemployment benefits program. Apart from the normal beneficiaries, the unemployment benefits program will now also cover freelancers and workers in the gig economy. The bill also offers loans and tax breaks to companies which are under threat of going out of business. On top of that, Donald Trump said that ‘tremendous medical supplies’ will now be coming soon.

Amendment in the EPF Scheme
The Union Labour and Employment Ministry has sought an amendment in the Employee Provident Fund Scheme in wake of the COVID-19 pandemic which has now claimed 20 lives and plans to murder the global economy. The amendment allows members to withdraw nonrefundable amounts of money. Read MoreThe notification permits withdrawal not exceeding the basic wages and dearness allowance for three months or up to 75% of the amount standing to member’s credit in the EPF account in the event of outbreak of epidemic or pandemic. This provides some sort of relief to the people allowing them some sense of security in a panic situation where prices are expected to rise and supply is expected to fall drastically.

Telcos opt for EMI Moratorium
Debt-ridden telecom operators are likely to opt for a three-month moratorium to avoid cash crunch during the lockdown. The telecom operators have spoken in favour of raising mobile call and internet rates at the earliest, however, they will keep the prices stable during the lockdown period. Read MoreThere is debt of around ₹1.6-2 lakh crore that telecom operators owe to Indian banks. They will opt for a three-month moratorium in loan repayment to help them maintain cash flow. The RBI on Friday allowed banks to put on hold EMI payments on all term loans for three months, slashed the cost of fresh borrowing by cutting policy interest rate by steepest in more than 11 years and infused a massive Rs 3.74 lakh crore liquidity as it joined the efforts of the government to counter the economic fallout of Coronavirus pandemic.


FM Nirmala Sitharaman announces Rs 1.7 lakh crore relief package for the poor
The government has planned to provide with cash and other amenities such as free cereals and cooking gas for a period of three months to the most hit section of the society. The FM Nirmala Sitharaman announced a relief package of total 1.7 crore to ease the burden on more than 800 million people. Read MoreUnder MGNREGA, poor, senior citizens, disabled people and widows will get Rs 1000 ex-gratia payment and an increase in wages for the workers. Government will also provide insurance cover to healthcare workers, contribute to provident fund and a separate fund has also been created for construction workers. 

RBI cuts Repo rate by 75 bps to 4.40% to mitigate Covid-19 impact
In the wake of Coronavirus- induced crisis, RBI brought a 75 basis point cut in the Repo rate on Friday, bringing it as low as 4.4%, the lowest ever. The minimum it had reached was 4.74% in 2009 in response to the Global Financial crisis. Read MoreTo improve the liquidity position of the banks, RBI also reduced the Cash Reserve Ratio (CRR) by 100 points bringing it to 3%. The Reverse Repo rate was also lowered by 90 bps. The rate cuts will bring stability in the system and induce growth, according to the FM. 

UK unveils plan for Self Employed workers
The relentless spread of Coronavirus has shocked the collective consciousness of the people of United Kingdom. Prince Charles and the British Prime Minister Boris Johnson have tested positive for the disease. However, news regarding these high-profile names has overshadowed the difficulties that the common man in UK is facing because of this disease. Read MoreA few days ago, the government had announced a slew of economic measures to combat the problem. However, it had faced criticism for failing to provide support to freelance and self employed workers. The government has finally decided to act on that front. Self employed people will now be able to apply for a grant worth 80 percent of their average monthly profits over the last 3 years, up to 2,500 pounds a month. The money will be paid as a single lump sum by June. Moreover, the scheme is open to those who earn under 50,000 pounds a year- hence, it includes 3.8 million out of the 5 million self employed workers in UK. The grants will be taxable and will need to be declared on tax returns by January 2022. 

India’s GDP Forecast
The Coronavirus pandemic has added fuel to fire we can say in how it is impacting the global economy. Keeping in mind the  Sino-US trade war which had sparked speculations of a forthcoming global recession. In the wake of the pandemic Moody’s Investor Service has slashed its GDP growth forecast for India to 2.5% in 2020 – a sharp drop from an earlier projection of 5.3%. Read MoreThe ratings agency expects the country’s economy to recover in 2021, estimating a growth rate of 5.8%, but warned that uncertainty regarding the virus’s spread and containment makes it difficult to fully assess the economic toll of the crisis. India grew at 5% in 2019. Globally, the world economy was facing an “unprecedented shock” and the G20 countries were likely to see an overall contraction of GDP by 0.5%, said Moody’s Global Macro Outlook 2020-21, released on Friday. It projected that the G-20 GDP growth rate, which was 2.6% in 2019, is likely to recover to 3.2% in 2021. At the low growth rate of 2.5% in 2020, India may see a sharp fall in incomes, further weighing on domestic demand and the pace of recovery in 2021.


Sensex hits 10% lower circuit, trading halted for 45 minutes
This week Sensex and Nifty saw their one of the biggest drops, coronavirus pandemic being one of the main reasons.  As countries are going on a lockdown, Sensex hit the lower circuit limit of 10% and trading halted for 45 minutes. Read MoreThe index reached as low as 26,924.11. Trading in the Indian stock market has halted twice in a span of 10 days with Nifty hitting the lower circuit on 13th March followed by Sensex. As the governments across the globe closed all non essential business, the global economy expects a global recession coming up. 

Corporate bonds get Rs 1-trn relief as Coronavirus ignites large sell-offs 
On Friday, RBI announced that it will provide banks with Rs 1 trillion through targeted long-term repo operations (TLTROs) to buy investment-grade corporate bonds, commercial paper, and non-convertible debentures. There have been huge sell-offs in the bond market and it is posing difficulties for companies in assessing working capital loans in a falling credit growth environment. Read MoreThis move by RBI affected the yields on these bonds, largely on high rated bonds. HDFC’s bonds maturing in March 2022 had its yield fall from 8.25% to 6.60%, while yields on Reliance Industries’ August 2022 bond fell from 8.55% to 7.25%

America’s mortgage market under peril 
In a few days, millions of Americans are going to have to make fresh payments on their mortgages. What may seem like a routine thing isn’t so for people who’ve incomes have taken a hit because of the spread of Coronavirus. To prevent major delinquencies from materializing, the mortgage companies have agreed to help the borrowers through a plan. Read MoreHowever, they want the government to help them. The American Bankers Association and the Mortgage Bankers Association have agreed to a plan which would allow the borrowers a payment break for 3-12 months depending on the situation of the crisis. They will eventually have to pay the full amount, but for now they are not obligated to make any payments. However, such a plan is likely to put a 3 trillion dollar burden on the Industry which leads to its collapse if the government doesn’t intervene. Representatives from the industry have written to the Treasury Secretary Steve Mnuchin seeking financial help. Government’s response is awaited.

Farm Loans NPA Norms
The recent hail storm coupled with the Corona-Pandemic has caused great stress to the agricultural sector as a unit. In some locations the harvest has been completely damaged by the hail storm while in the other regions there is no labour to harvest the produce which if not harvested will be spoiled in the next 10 days. Read MoreIn the light of this situation at hand The Finance Ministry has asked the Reserve Bank of India (RBI) to relax asset classification norms for farm loans extended by banks following the stress faced by the agriculture sector. It is requested to consider making appropriate relaxation in asset classification norms in respect of short-term agricultural crop loans for a period up to 30th June 2020.

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