The First Forum – Edition 82

The First Forum is an initiative that focuses on covering the latest happenings in a brief format. This is in lieu of the importance of knowledge about current happenings in this fast-changing world.
In the Eighty Second- Edition of The First Forum we would be covering the following topics:
1. Politics
2. Science and Technology
3. Business
4. Economics
5. Finance

(By Ashika Deb, Shitij Goyal and Gunika Vij)

Politics

Russia’s increasing poverty causes political discontent

The pandemic has delivered a new blow to Russia’s stagnating economy, which was already chafing under Western sanctions, low oil prices and weak corporate investment. The rising poverty, falling incomes and lack of tangible government support are fuelling discontent with the President’s rule and strengthening the opposition and answering the jailed Kremlin critic Navalny’s call thousands of people have protested. Read MoreRussians’ real disposable incomes have been falling for the past half-decade while the cost of basic food has increased. In December Putin had ordered to introduce emergency measures to handle prices but the efforts were quite futile.

‘Political cowardice’: Trump’s impeachment acquittal

Democratic Party legislators in the US have reacted with indignation to the results of former President Donald Trump’s second impeachment trial, after the US Senate found Trump not guilty of “inciting” a deadly riot on Capitol Hill last month. Read MoreThe Senate voted against the impeachment.  Shortly after Saturday’s verdict, President Joe Biden issued a statement noting that the number of Republicans who voted to convict Trump was a record. Trump’s legal team had rejected Democrats’ effort to impeach him, calling the trial unconstitutional because he is no longer in office.

Andhra political parties up in arms against Vizag steel privatisation plan

Political parties in Andhra Pradesh are against the Centre’s proposed privatisation of Rashtriya Ispat Nigam Limited (RINL), with the opposition Telugu Desam Party (TDP) and Left parties launching an agitation against it. The secretary of the department of investment and public asset management, last week announced that the Cabinet Committee of Economic Affairs had cleared the privatisation of RINL, which employs 34,000-odd people. Read MoreA TDP leader launched a fast-unto-death at the local party office on Wednesday demanding the Centre withdraw its proposal. Union minister on Wednesday told Parliament that South Korean steel giant POSCO was keen on acquiring a majority stake in the plant.

US Revoked Yemen’s Houthis As Terrorists

The UN welcomed USA’s decision to revoke the designation of Yemen’s Houthi rebels as a terrorist group. The Biden Administration on February 12 reversed former Presdient’s actions that humanitarian groups feared that it would impede aid deliveries to the conflict-torn country facing the world’s worst crisis. Read MoreThe US Secretary of State said that the new administration listened to warnings from the UN, humanitarian groups, bipartisan members of Congress and others “that the designations could have a devastating impact on Yemenis’ access to basic commodities like food and fuel”.

Science and Technology

Pfizer’s vaccine appears to reduce coronavirus transmission
People vaccinated with Pfizer’s shots and who still get infected with the coronavirus carry less virus in their bodies than unvaccinated people who are infected, researchers from Israel report in two separate preliminary studies posted February 8 at medRxiv.org.

Google Strikes Deal With Australian News Outlet Amid Content Payment Row
Australia’s Seven West Media became the country’s first major news outlet to strike a licensing deal with Google, as the government pushes ahead with a law that would force the Internet giant to pay media companies for content. Read MoreAt an earnings announcement Seven, which owns a free-to-air television network and the main metro newspaper in the city of Perth, said it would supply content for Google’s News Showcase platform. It did not disclose terms.

Alphabet, Microsoft, and Qualcomm Complain Against Nvidia Arm Acquisition; US FTC Opens Probe: Report
The US. Federal Trade Commission has opened an in-depth probe into Nvidia’s agreement to acquire Arm, Bloomberg reported. The FTC has sent information demands to third parties. The FTC and Nvidia did not respond to requests for comment outside regular working hours. Read MoreNvidia struck a deal with Japan’s SoftBank Group in September to buy UK-based chip designer Arm Holdings for as much as $40 billion (roughly Rs. 2,90,365 crores).

Bumble CEO Whitney Wolfe Herd Becomes a Rare Female Billionaire Following IPO
A company catering to women and led by women has made its 31-year-old female founder a billionaire. Shares of Bumble, the owner of the dating app where women make the first move, soared 67 percent in its trading debut to $72 (roughly Rs. 5,250) in New York (11:33pm IST), valuing Chief Executive Officer Whitney Wolfe Herd’s stake at $1.5 billion (roughly Rs.10,920 crores).Read More The listing caps a saga that’s both inspiration and cautionary tale for women tech founders. Wolfe Herd capitalised on an underserved market and built a multibillion-dollar company that was in a sense born from one of the most vexing obstacles to women entrepreneurs: sexual harassment.

Making masks fit better can reduce coronavirus exposure by 96 percent
Taking steps to improve the way medical masks fit can protect wearers from about 96 percent of the aerosol particles thought to spread the coronavirus, a study by the U.S. Centers for Disease Control and Prevention found.Read More That’s provided both people are wearing masks. But even if only one person is wearing a mask tweaked to fit snugly, the wearer is protected from 64.5 percent to 83 percent of potentially virus-carrying particles, the researchers report February 10 in Morbidity and Mortality Weekly Report.

Business

FM underlines role of pvt sector; says bending Covid curve, Budget will help sustain revival
Pursuing with the process of consensus building on politically difficult reforms such as privatisation, Finance Minister Nirmala Sitharaman Friday said the BJP government has laid out well-thought-out reforms to support Indian entrepreneurs, wealth creators and MSMEs while respecting honest taxpayers and citizens. Read More With Prime Minister Narendra Modi emphasising the importance of the private sector in creating wealth and generating jobs two days ago in the Lok Sabha, she underscored the importance of private enterprises and said that “unless wealth creators create wealth”, there will be nothing to distribute in the economy.

ONGC to form new subsidiary to focus on gas and LNG business
State-run energy major ONGC will create a wholly-owned subsidiary to focus on its company’s gas and LNG business. Its Board of Directors has given its nod for the creation of the subsidiary company subject to necessary approvals. Read More According to the company, the standalone Q3FY21 net profit fell to ₹1,378 crore as against ₹4,226 crore reported during the corresponding period of previous fiscal. Similarly, gross revenue declined 28.2 per cent to ₹17,024 crore as against ₹23,710 crore in FY20.

Cipla plans to double share from consumer health business in 5 years
Cipla, the country’s third-largest pharma major, aims to more than double the contribution from consumer hea­lth business to its overall global turnover in five years.Read More The consumer health business now accounts for 5-6 percent of Cipla’s overall turnover, and as Kedar Upadhye, global chief financial officer (CFO), Cipla, put it, the aim is to take that beyond 12 per cent in the next five years.

Tata Motors appoints Daimler veteran, Marc Llistosella as its India business chief
Tata Motors Ltd, India’s largest vehicle maker, named Marc Llistosella as the managing director and chief executive officer (MD and CEO) of its India business which comprises the commercial and passenger vehicle businesses. Read MoreIn his last assignment, Llistosella served as president and chief executive of Fuso Truck and Bus Corp., a unit of Germany’s Daimler. Prior to that, Llistosella also worked as the head of Daimler Trucks’ subsidiary in Asia and MD and CEO of its India unit, Daimler India Commercial Vehicles Pvt. Ltd.

Adar Poonawalla to acquire 60% in Magma Fincorp for Rs 3,456-crore
Adar Poonawalla-controlled Rising Sun Holdings will acquire a 60 per cent stake in non-banking financial company (NBFC) Magma Fincorp by subscribing to a Rs 3,456-crore preferential issue. After the infusion of capital, Magma and its subsidiaries will be renamed and rebranded Poonawalla Finance. Read MorePoonawalla Finance is an existing finance company owned by the Poonawalla family, which owns and controls Serum Institute of India. As part of the deal, Magma Fincorp (MFL) will allot 458 million shares to Rising Sun Holdings, and 35 million shares to Sanjay Chamria and Mayank Poddar, Magma and Poonawalla Finance said in a joint statement on Wednesday.

Economics

Indian economic documents exude a growth anxiety
The Budget for 2021-22 has projected nominal GDP growth of 14.4% over the first advance estimates for 2020-21.  Assuming that consumer inflation during 2021-22 will stick to the 4% target, then the real GDP growth is 5.5%. Anxiety over tepid growth may have also influenced the government’s policy on revenue sharing with states.Read More The Budget should have been the ideal platform to provide a growth impetus to one of the worst pandemic-affected economies instead, its design has ensured that states not only end up with less money, but are also deprived of their legitimate claims which may be viewed as a contingency measure to strengthen government spending, but there is a high risk it will become permanent because governments have rarely retired a cess or surcharge.

Japan Extends Economic Recovery

Japan’s economy expanded more than expected in the fourth quarter, extending the recovery from its worst post-war recession owing to a rebound in overseas demand that boosted exports and capital spending but the recovery slowed from the third quarter’s brisk pace and new state of emergency curbs cloud the outlook.Read More It grew an annualised 12.7% in October-December but it was slower than the revised 22.7% surge in the previous quarter, when the economy got a lift from pent-up demand after a previous state of emergency was lifted in May. For the full coronavirus-stricken year, Japan’s economy contracted 4.8%, the first annual fall since 2009.

Britain economy suffers biggest slump in 300 years

The UK economy grew at double the pace expected in fourth quarter. GDP rose 1% from the third quarter fuelled by boom in construction and government spending which averted the risk of a second recession but left a 9.9% contraction for the whole of 2020, the biggest in 300 years. Read MoreThe figures add weight to the Bank of England’s view that growth is set to surge as the Prime Minister’s vaccination campaign takes hold.

Singapore’s 2021 budget set to be unusual.

Singapore will likely incur a rare budget deficit this year as the government continues to support its economic recovery from the Covid pandemic which will be unusual as the government typically starts the first year of its new term with a sizeable budget surplus. Read MoreTheir government’s fiscal prudence is one reason behind its coveted AAA credit ratings by international agencies but this time around, the Prime Minister has warned that with the coronavirus pandemic hitting the economy, his government “may take a while” to “come back”. Singapore dug into its reserves to fund part of its stimulus package worth more than 90 billion Singapore dollars ($67.5 billion).

Finance

Capital infusion into insurance companies

The Finance Ministry will infuse Rs 3,000 crore capital into state-owned general insurance companies during the current quarter in a bid to improve their financial health. Last year, the Union Cabinet headed by Prime Minister Narendra Modi cleared proposal to provide capital support to National Insurance, Oriental Insurance and United India Insurance. Read MoreThe cabinet had also decided to increase the authorised share capital of National Insurance Company Limited (NICL) to Rs 7,500 crore and that of United India Insurance Company Limited (UIICL) and Oriental Insurance Company Limited (OICL) to Rs 5,000 crore each to give effect to the capital infusion decision.

Government to allow FPIs to debt finance

The finance ministry on Thursday said the Finance Bill has proposed amendments to permit foreign portfolio investors (FPIs) an entry into debt financing of emerging investment vehicles – REITs and InvITs. The move is aimed at increasing funds for the infrastructure and real estate sectors. Finance minister Nirmala Sitharaman announced this move during Budget 2021. Read More“In this context, the Government of India as part of the Finance Bill, 2021 has proposed amendments in the Securities Contracts (Regulation) Act, 1956 and Securities and Exchange Board of India Act, 1992 with consequential amendments in the Securitisation and Reconstruction of Financial Assets and Enforcement of SecurityInterest Act, 2002 and The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 to confer the power to Pooled Investment Vehicles (defined to include AIFs, REITs, InvITs etc.) to borrow and issue debt securities,” the finance ministry said in a statement.

More Agri infra schemes on the cards

Finance secretary Ajay Bhushan Pandey has indicated that more schemes for agriculture development and infrastructure may be rolled out in FY22 as the government expects to generate Rs 30,000-35,000 crore from the agriculture infrastructure and development cess introduced in the Budget. Read MoreWhile the budgetary allocation for the department of agriculture and cooperation has been reduced by 8% to Rs 1.23 lakh crore for next financial year from the budget estimate of FY21, there is no new scheme announced.

Highest Ever spending in MNREGA in FY21

Finance minister Nirmala Sitharman on Friday said Prime Minister Narendra Modi-led NDA government has removed all ills from the rural-employment guarantee scheme MNREGA and spent highest ever about Rs 90,500 crore so far this fiscal. Show More Replying to the budget debate in the Rajya Sabha, the minister attacked the opposition Congress failing to utilise the entire amount allocated in the Budgets when they were in power. She said during the Covid pandemic year, the government has spent Rs 90,469 crore under the MNREGA rural employment scheme, which highest ever. Sitharaman said for 2020-21, the budget estimate was Rs 61,500 crore for the scheme, which has been increased to Rs 1,11,500 in the revised estimates.