Economy Current Affairs
Economy Current Affairs February 3rd Week 2016
Category : Economy Current Affairs
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1) Facebook withdraws Free Basics from India.

  • Facebook has withdrawn the controversial Free Basics services from India following the telecom regulator disallowing differential pricing.
  • In May last year, it had launched the service offering free access to 32 apps and websites on Reliance Communications’ network.
  • RCom users could have accessed these apps and websites without paying for data usage.


  1. Facebook had announced this as part of the initiative aimed at connecting the next billion users to the World Wide Web. This had come under severe criticism by supporters of Net neutrality.
  2. According to them, offering free access to select apps and websites violates principles of net neutrality because Facebook was acting as gatekeeper to give preferential treatment to a few websites and apps.
  3. Globally, there are about 19 countries where Facebook has launched free basic services. But, India is perhaps the most critical market where it has now lost the battle.

2) CCI nod for Nippon Life stake hike in Reliance Life.

  • The Competition Commission of India (CCI) has given its approval for Japanese insurance major Nippon Life Insurance to hike its stake in Reliance Life Insurance to 49 per cent.
  • This transaction involved an investment of Rs. 2,265 crore ($348 million) for an additional 23 per cent stake.
  • This transaction pegs the valuation of Reliance Life at about Rs. 10,000 crore ($1.5 billion). Nippon Life’s investment represents implied embedded value multiple of over three times, the highest in the industry till date.
  • Also, Nippon Life’s investment represents the largest foreign direct investment in the Indian insurance sector till date.
  • With this transaction, Nippon Life will have invested a total of Rs. 8,630 crore ($1.3 billion) for acquiring 49 per cent stake each in Reliance Capital Asset Management and Reliance Life Insurance.

3) Ashok Leyland to set up assembling units in Africa.

  • Ashok Leyland is setting up truck and bus assembling units in Africa, one of them in Kenya. This is a part of its plan to strengthen its export markets.
  • The truck and bus manufacturer is also looking at South-East Asia and South America for exports.
  • The objective is to triple exports over the next 3-5 years from the present 10 per cent.
  • Over the last couple of years it has managed to bring down debt from about Rs. 6,400 crore in August 2013 to about Rs. 3,500 crore.
  • Total industry volume in the current year has grown by 30 per cent to 2.07 lakh units for medium and heavy commercial vehicles.

4) Companies to get Business Identification Number.

  • To improve ease of doing business, the government will soon introduce Business Identification Number (BIN) for companies, doing away with multiple registration numbers a single entity needs to obtain for various regulatory purposes.
  • The BIN would act as an identification number for different regulatory purposes and do away with the need for procuring separate registration numbers such as Company Identification Number and Labour Identification Number.
  • Normally, a company is required to obtain 18 different registration numbers. As per the proposal, the permanent account number (PAN) may become the BIN for companies.
  • The firms will have to apply for the BIN on the e-Biz portal. The portal provides one-stop clearance platform for investment proposals.
  • Several initiatives have been taken up by the government for improving ease of doing business in India through simplification and rationalization of the existing rules and introduction of information technology to make governance more efficient and effective.

5) Swedish defence firm ties up with Indian company.

  • Kalyani Group has tied up with Swedish defence major Saab to form a joint venture firm for the multi-billion dollar contract for short range surface to air missile and man-portable very short-range air defense (VSHORAD) programmes.
  • The joint venture, which will be set up by Saab and Kalyani Strategic Systems Ltd (KSSL), the defence arm of Kalyani Group, will handle the main part of production and delivery of these air defence systems to the Indian customer if they win the ongoing tender process.
  • The production in India will comprise of subsystems and systems for SRSAM and VSHORAD with the aim to transfer production as well as development knowledge to India.
  • To secure production quality, orders of missile parts have already been issued to KSSL and production-readiness reviews are ongoing.

6) Oracle will open its first campus in India.
Oracle has announced plans to expand campuses outside the US and will open one in Bengaluru as part of the ‘Make in India’ campaign.
The company will also launch 9 incubation centres throughout India, and train more than half a million students each year to develop computer science skills.
The Oracle India campus will be spread over a huge 2.8 million square feet, and will be largest outside its headquarters in Redwood Shores, California.
The buildings will include collaboration centers, workstations, and large spaces in addition to entertainment lounges, gyms, a basketball court, open green spaces, and cafes.
The nine Incubation Centers will contribute to country’s “Start-up India” initiative.
The centres will be located in Bengaluru, Chennai, Gurgaon, Hyderabad, Mumbai, Noida, Pune, Trivandrum and Oracle Academy Expansion.

7) YouTube acquires BandPage for $8 million.

  • Google owned YouTube acquired BandPage for a reported $8 million, which is far less than the $27.6 million raised by the startup since launching in 2009.
  • BandPage is already heavily integrates into both YouTube and Google, delivering photos and band info for more than 500,000 artists, along with direct to fan offerings from hundreds of musicians.

About BandPage:

  1. Founded in 2009, BandPage began as an app that let musicians create a special Music tab on their Facebook Page.
  2. But after Facebook shut down these Page apps in 2012, it lost 90% of its traffic in three months. It went from 32 million monthly users and being the second most popular Facebook developer behind Zynga, to just a few million.
  3. BandPage created a platform that artists could update with their tour dates and t-shirts, and have them appear in tons of places through integrations with Spotify, SoundCloud, Facebook, Twitter, Shazam, Rhapsody, StubHub, and more, as well as Google and YouTube.

8) National Capital goods policy unveiled.

  • The Government has unveiled the National Capital Goods Policy. The policy envisages increasing exports from the current 27% to 40% of production while increasing share of domestic production in India’s demand from 60% to 80%, thus making India a net exporter of capital goods.
  • The policy also aims to facilitate improvement in technology depth across sub-sectors, increase skill availability, ensure mandatory standards and promote growth and capacity building of MSMEs.

About National Capital Goods Policy:

  1. “National Capital Goods Policy” is a unique Government led- industry driven manoeuvre for scripting a new growth narrative in the history of industrial development.
  2. The Department of Heavy Industry had set up a Joint Taskforce with Confederation of Indian industry (CII) as an attempt to ensure that the formulation of the Capital Goods Policy is done in the most democratic manner and the recommendations would carve out a roadmap for Capital Goods sector to become a part of global value chains apart from mere supply chains.

The Key Recommendations of the policy:

  • Strengthening the existing scheme of the DHI on enhancement of competitiveness of Capital Goods Sector by increasing budgetary allocation for increasing scope to further boost global competitiveness in various sub sectors of CG.
  • Enhancing the export of Indian made capital goods through a ‘Heavy Industry Export & Market Development Assistance Scheme (HIEMDA)’.

9) Apple to set up first Technology Center in India.

  • Apple to up its first technology development center outside the US, in Hyderabad, India.
  • It is set to open by June, becoming fully operational by the end of the year. The facility is projected to create 4,500 jobs, and is expected to develop solutions for Apple’s in-house mapping service.
  • Apple’s decision to set up a development center in Hyderabad is not surprising, considering that most major American companies including the likes of Microsoft, Google, NVIDIA, Qualcomm, Facebook, and IBM have facilities in the city.
  • Microsoft has its largest campus outside Redmond in Hyderabad, and Google also has a sizeable presence in the city, with the search giant considering a new 2 million square feet office.
  • Apple’s sales in India crossed the $1 billion sales mark last March, and the company has been working with the Indian government to fast-track the construction of new Apple Stores in the country.

10) Ratan Tata invests in bengaluru based SnapBizz.

  • SnapBizz Cloudtech Pvt. Ltd, which devises technology for grocery stores have raised an undisclosed amount of funding from Ratan Tata, chairman emeritus of Tata Sons Ltd.
  • SnapBizz had earlier raised $7.2 million in an investment round led by venture capital firms Jungle Ventures, Taurus Value Creation, Konly Venture and Blume Ventures in January.

About SnapBizz:

  1. SnapBizz provides grocery stores, an Android-based, cloud-connected business platform in the form of a tablet, barcode scanner, printer and a consumer-facing LED display, and the technology enables merchants to manage their billing, inventory and customer engagement.
  2. SnapBizz is one of a small but growing number of start-ups like IPay Tech India Pvt. and StoreKing that aim to help small businesses like grocery stores to bridge the digital gap by targeting specific uses like payments or enabling e-commerce.


11) CII seeks cut in corporate tax rate in Budget.

  • India Inc has pitched for lowering of corporate tax rate and a roadmap to phase out incentives in the forthcoming Budget.
  • Finance Minister Arun Jaitley had, in Budget 2015-16, announced a plan to bring down corporate tax rate to 25 per cent over the next four years and the Finance Ministry had also come out with a discussion paper on winding up all exemptions.
  • It is suggested that minimum alternate tax should be abolished in view of removal of all incentives or, alternatively, the rate be brought down to 10 per cent.
  • It has also asked the government to maintain the existing rates of service tax at 14 per cent and central excise duty at 12.5 per cent. Further, it has sought credit of the Swachh Bharat Cess, and its utilization against payment of excise duty and service tax.
  • Seeking early implementation of the Goods and Services Tax, the industry body has also asked the government to announce a revised roadmap for its roll out. In this regard, it has called for reducing the central sales tax from two per cent to one per cent in view of the delay in implementing the GST.

12) Mobile handset maker Lava to invest Rs. 2,615 crore.

  • Domestic mobile handset manufacturer, Lava plans to double its production capacity in India at an investment of Rs. 2,615 crore.
  • Lava started manufacturing in India about nine months ago the company has not only seen lower production costs but also substantial improvement in quality and efficiency.
  • It already has a manufacturing facility in Noida and will open another in the same place in three months. The company has acquired 50 acres of land in UP and 20 acres in Tirupathi.

About Lava:

  1. Lava International Ltd. is an Indian mobile handset company with headquarters located in Noida, Delhi.
  2. Lava International was established in the year 2003 as Pacetel Communications. In 2009, the company was renamed Lava International.
  3. The company launched the world’s first Intel chip-based smartphone. It was founded by Hari Om Rai, Sunil Bhalla, Shailendra Nath Rai and Vishal Sehgal.

13) Vedanta ties up with Odisha government for aluminium park.

  • Anil Agarwal group company Vedanta has signed an agreement with the Odisha government to set up an aluminium park adjacent to its aluminium smelter at Jhasarguda.
  • The proposed park, to come up on 240 acres, has the potential to attract investment of Rs. 1,000 crore and generate direct and indirect employment to about 17,000 people.
  • The company would be able to sell aluminium in molten form to manufactures within the park, rather than supplying it in ingots or sheets, thus saving huge costs for both Vedanta and the manufacturers.
  • Units within the park can start production at short notice and Vedanta, with adequate smelting capacity and 3,600 MW of power generation, can assure uninterrupted supply at very competitive prices.
  • The Odisha government will provide the necessary infrastructure for setting up the industries with financial incentives. Both Vedanta and the Odisha government will hold global road shows to attract investment.

14) India asks Vodafone to pay taxes or face seizure.

  • India may seize Vodafone Group Plc’s assets in the country if the company doesn’t pay a disputed Rs. 14,200 crore tax bill that’s still undergoing international arbitration proceedings.
  • Vodafone has disputed the tax bill levied by Indian authorities over its 2007 purchase of the India business of Hutchison. The telecom giant bought a majority stake in the mobile company from Li Ka Shing Holdings through a subsidiary based in the Netherlands.
  • The $11.2 billion transaction was routed through Cayman Islands, and Vodafone said it did not owe the Indian government any taxes for the deal since it was conducted offshore.
  • After the country’s Supreme Court ruled in Vodafone’s favor in early 2012, the government amended the country’s taxation laws to apply retroactively to transactions like the Vodafone-Hutchison deal.

About Vodafone:

  1. Vodafone Group plc is a British multinational telecommunications company headquartered in London and with its registered office in Newbury, Berkshire.
  2. Vodafone owns and operates networks in 26 countries and has partner networks in over 50 additional countries.
  3. Vodafone has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index.

15) CBDT resolves Rs. 5,000 crore worth cases through Mutual Agreement Procedure.

  • With the aim to provide a non-adversarial and stable tax regime to foreign investors, the Central Board of Direct Taxes has resolved 180 cases involving Rs. 5,000 crore of funds through the Mutual Agreement Procedure (MAP).
  • The countries with which cases have been resolved are the US, Japan, United Kingdom and China. The resolved cases pertain to various sectors including software services, IT enabled services, manufacturing and consultancy services.
  • This is one of the actions taken by CBDT to ensure a fair and judicious dispute resolution regime to encourage foreign investment.
  • Meanwhile, Finance Minister Arun Jaitley said the Income Tax department’s use of technology and e-mails will help taxpayers and cut down their physical interface with the officials.
  • As many as 3.6 crore returns have been processed at the Central Processing Centre, Bengaluru and 1.4 crore assessees who had filed their returns online have been notified of their refunds.

16) Punj Lloyd bags Rs. 2,070 crore order in Oman.

  • Engineering, procurement and construction major Punj Lloyd said that it has won orders in the oil & gas sector worth Rs. 2,070 crore from Oman Oil Refineries and Petroleum Industries Company (ORPIC) and Oman Gas Company (OGC).
  • The scope of work the contracts includes is the construction of a 300-km natural gas liquid (NGL) pipeline and a 301-km gas pipeline.
  • The first pipeline is part of ORPIC’s $6.4 billion Liwa Plastic Industries Complex (LPIC) and will travel from the New Fahud NGL Plant to the steam cracker unit at Sohar in Oman.

17) BHEL commissions 101 MW power plant in Tripura.

  • State-run Bharat Heavy Electricals Limited (BHEL) has commissioned a 101 MW (Mega Watt) gas-based Combined Cycle Power Plant (CCPP) at Monarchak (near Agartala) in Tripura.
  • The plant was commissioned on basis of Engineering, Procurement and Construction (EPC) based on the order placed by North Eastern Electric Power Corporation Limited (NEEPCO).

About 101 MW power plant:

  1. In this project, BHEL’s scope of work included supply of Gas Turbine, Heat Recovery Steam Generator (HRSG) and Steam Turbine.
  2. It also supplied Generators and state-of-the-art Controls & Instrumentation (C&I) including plant civil work.
  3. State-run Oil and Natural Gas Corporation (ONGC) will be supplying the gas for the project. With this, BHEL’s share in supplied sets in the installed power generating capacity of Tripura has gone up to 88 per cent.

18) HCL Tech seals Rs. 895 crore deal with Volvo.

  • HCL Technologies has closed an outsourcing deal with Swedish auto major Volvo Group for infrastructure and application operations.
  • The deal, pegged at around $138 million (around Rs. 895 crore), is for making Volvo ready for the rapid advancements in business-enabling technology such as cloud, automation, business intelligence and big data.
  • HCL has also acquired Volvo’s external IT business, adding 40 new customers from the Nordics and France to its portfolio.
  • Around 2,500 people working for the Volvo Group will be transferred to HCL across 11 countries and Volvo IT customers would now have the advantage of access to a broad range of differentiated global capabilities, tools and processes that integrate with technology environments at a global level.
  • It would also create an automotive centre of excellence in Gothenburg based on the domain expertise of the Volvo team, to serve HCL’s global automotive and manufacturing customers.

19) BAE Systems, Mahindra partner in Howitzer deal.

  • BAE Systems has announced selection of Mahindra as its India partner for the nearly $700 million deal for the supply of 145 M777 Howitzers.
  • The gun deal would be through Foreign Military Sales (FMS) but the “spares, maintenance and ammunition will be operated through Indian systems”. M777 Howitzers are ultralight weight artillery guns having a strike range of 25 kms.
  • India and the United States are in discussion for supply of 145 M777A2 LW155 Howitzers for the Indian Army. Last year, BAE developed and submitted a US government-supported proposal offering a higher degree of indigenization on the M777 weapon system.

About BAE Systems:

  1. BAE Systems was formed on 30 November 1999 by the £7.7 billion merger of British Aerospace (BAe) and Marconi Electronic Systems (MES).
  2. BAE Systems plc is a British multinational defence, security and aerospace company headquartered in London in the United Kingdom and with operations worldwide.
  3. Its largest operations are in the United Kingdom and United States, where its BAE Systems Inc. subsidiary is one of the six largest suppliers to the US Department of Defense.

20) Tata invests in eco-friendly Bollant Industries.

  • Hyderabad based packaging material maker Bollant Industries has raised an undisclosed funding from Ratan Tata. This is the third non tech investment by Ratan Tata.
  • He had earlier invested in Grameen Capital India, a social impact-focused investment advisory firm and also in healthcare service provider Swasth India.

About Bollant Industries:

  1. Launched in 2012 by Srikanth Bolla, Bollant Industries manufactures eco-friendly paper and biodegradable products and provides mainstream employment to several hundred differently-abled people.
  2. The company currently employs 400 workers across five operating plants in Telangana and Karnataka. A new mega-plant is in the works at Sri City Special Economic Zone in Andhra Pradesh.

21) NRDC inks MoA with IACS on Technology Transfer.

  • National Research Development Corporation (NRDC) has signed a Memorandum of Agreement (MoA) with Indian Association for the Cultivation of Science (IACS) for commercialization of technologies and intellectual properties (IP) developed at IACS.
  • Under this MoA, NRDC will provide its services in IP Evaluation and Valuation in terms of their commercial potential to IACS.

About National Research Development Corporation (NRDC):

  1. It is an Enterprise of Department of Scientific & Industrial Research under the aegis of Union Ministry of Science & Technology.
  2. So far, it has licensed technologies of more than 4800 companies/ entrepreneurs in the country in almost all sector of industry.

About Indian Association for the Cultivation of Science:

  1. IACS based in Kolkata (West Bengal) is an autonomous and oldest research institute in India.
  2. It is devoted to the pursuit of fundamental research in the frontier areas of Physics, Biology, Chemistry, Polymer, Energy and Materials.


22) BHEL commissioned 270 MW unit of GVK power plant in Punjab.

  • State-run equipment maker Bharat Heavy Electricals Ltd (BHEL) commissioned a 270 MW generation unit at the Goindwal Sahib Thermal Power Project of private producer GVK Power & Infra in Punjab.
  • All the operational sets of 210-270 MW class in the state of Punjab have been supplied, erected and commissioned by BHEL.
  • Six units of 210 MW at Ropar, 2 units of 210 MW and 2 units of 250 MW at Bhatinda, besides 270 MW Unit at Goindwal Sahib.

23) Cipla acquires two US generic drug companies.

  • Indian pharmaceutical giant Cipla Ltd. has acquired two US generic drug companies, InvaGen Pharmaceuticals Inc. and Exelan Pharmaceuticals Inc.
  • In this regard, Cipla has closed the transaction of the deal through its wholly-owned subsidiary, Cipla (EU) Ltd.
  • These deals will allow Cipla to further strengthen its presence in the US pharmaceutical market is world’s largest pharmaceutical market.
  • It will also help the company to increase its revenue and introduce new products for oncology and diabetes in US.
  • These acquisitions will also provide Cipla a launch pad to launch its pipeline of products in respiratory and injectables in US.

24) Alstom, Cipla among 10 FDI proposals worth Rs. 607 crore cleared.

  • The Centre has cleared 10 foreign direct investment proposals worth Rs. 607 crore. It has also referred the Rs. 5,856.51 crore proposal of ATC Asia Pacific for acquisition of 51 per cent stake in Viom Networks to the Cabinet Committee on Economic Affairs.
  • The decisions were taken at the meeting of the Foreign Investment Promotion Board.
  • ``Eight proposals have been deferred. Five proposals have been rejected``, said an official.
  • The proposals approved include the Rs. 400 crore proposal of Alstom to arrange equity for its locomotive factory at Madhepura. It also approved the Rs. 145.22 crore FDI proposal of Cipla Ltd.
  • Other proposals cleared include those of pharma companies Glenmark Pharmaceuticals, Emcure Pharmaceuticals and Celestis Pharmaceuticals.
  • Among eight proposals deferred include those of ICICI Lombard General Insurance, ICICI Prudential Life Insurance, Taurus Ventures and Almondz Insurance Brokers.
  • Five FDI proposals rejected include those of Ashdene Investments, Veritas Ltd, KDK Softwares, Kemefs Specialities and Afro Asia Equipments.

25) CCEA clears laying of 6 rail lines worth Rs. 10,700 crore.

  • Ahead of the Railway Budget, the Cabinet Committee on Economic Affairs approved construction of six railway lines and a bridge to cater to both increased passenger and freight needs, for an estimated cost of Rs. 10,700 crore.
  • It will be financed through extra-budgetary resources, Railway Minister Suresh Prabhu said after the meeting. The projects will be constructed using the Rs. 1.5 lakh crore invested by Life Insurance Corporation in the Railways.
  • The projects include doubling of three railway lines - the 190-km Hubbali-Chickajur line for Rs. 1,294.13 crore; the 160-km Ramna-Singrauli line for Rs. 2,675.64 crore; and the 261-km Katni-Singarauli section for Rs. 2,084.90 crore.
  • Two projects for the construction of a third line - in the 132-km Wardha (Sewagram)-Ballarshah section, costing Rs. 1,443.32 crore, and the 165-km Anuppur-Katni section in Madhya Pradesh, for Rs. 1,595.76 crore - were also approved.
  • All the six projects are expected to be completed over the next five years.

26) Big Bazaar Direct to tie up with Oxigen to expand reach.

  • Big Bazaar Direct, the assisted e-commerce business of the Future Group, is expanding its distribution reach by tying up with payment solutions company, Oxigen. With 2 lakh retailers across categories such as money transfer and DTH recharges, Oxigen is expected to enhance the distribution of Big Bazaar Direct at a time when Internet penetration in the country is still low.
  • ``Currently Big Bazaar Direct has 1,000 franchises but with this partnership with Oxigen, we expect to take it up to 10,000 franchises. Each franchise makes about Rs. 20 lakh a year``, said Kishore Biyani, Group CEO, Future Group.
  • Big Bazaar Direct connects with consumers through its franchises to sell products from the retail format of Big Bazaar with the help of a tablet or a Web ite without keeping any real stock and encourages entrepreneurship with its business model.
  • Rajan Malhotra, President- Retail Strategy, Future Group, said, ``Oxigen will serve as a distribution arm for all our brands and enhance our omni channel reach to our next level of customers``.