Issue: 1262
· ICICI Prudential Life to seek
IRDAI nod for Prudential's reclassification as investor.
· SBI plans to hire 1,500 POs
to boost business growth.
· India's banks are handing out
more loans, but deposits aren't keeping up.
· Paytm's European arm secures
payment institution licence in Luxembourg.
· Axis Bank leads large pvt.
banks in loan, deposit growth in Q1FY27.
· StanChart shuts 20 India
branches, sharpens focus on wealth management.
India begins work on
strategic natural gas storage after West Asia crisis: The recent West Asia conflict
has prompted the government to begin work on creating India's first strategic
natural gas storage system, with public sector oil companies evaluating multiple
options, including underground salt caverns and above-ground cryogenic LNG
tanks. The move marks a significant expansion of India's strategic energy
security planning. While the Indian Strategic Petroleum Reserves Limited
(ISPRL) manages the country's strategic crude oil reserves, it does not have
expertise in salt cavern-based natural gas storage. As a result, feasibility
studies are underway to assess suitable storage technologies and geological
structures.
(Business Line)
New-base GSDP estimates
likely by Aug-Sept, GDP back series by year-end: The statistics ministry is
working closely with states and Union Territories to help them shift Gross
State Domestic Product (GSDP) estimates to the new base year, with states
expected to finalise the exercise by August–September 2026, Saurabh Garg,
Secretary, Ministry of Statistics and Programme Implementation, told
Moneycontrol. Garg said the ministry is also exploring the use of AI, machine
learning and big data in official statistics, while putting in place safeguards
to protect privacy and confidentiality.
(Moneycontrol)
Govt withdraws emergency
gas curbs as LNG supplies normalise after crisis: The government has withdrawn
most provisions of the emergency natural gas supply regulation order imposed
during the West Asia conflict after liquefied natural gas (LNG) shipments
through the Strait of Hormuz resumed following a ceasefire. In a notification
issued on Saturday, the Ministry of Petroleum and Natural Gas amended the
Natural Gas (Supply Regulation) Order, 2026, omitting key operational
provisions, which led to all domestically produced natural gas and imported LNG
to be sold as per a new priority customer list drawn by the government.
(Business Standard)
PSU banks' loan growth
races ahead of deposits in Q1: PSBs opened the new financial
year with strong credit growth, driven largely by retail, agriculture and MSME
lending, but a slower pace of deposit mobilisation highlighted a familiar
challenge for lenders. Provisional business updates
released by nine state-owned banks for the quarter ended June 30 showed
advances growing much faster than deposits, reflecting sustained demand for
loans despite increasing competition for customer deposits. Bank
of Baroda reported a 17.4 per cent YoY increase in global advances, while
deposits rose 13.8 per cent. Bank of India posted loan growth of 18.64 per cent
against a 14.92 per cent rise in deposits. Retail, agriculture and MSME continued
to remain the biggest drivers of credit expansion.
(Moneycontrol)
Pvt sector banks log robust
growth in deposits and advances in Q1FY27: HDFC Bank, Kotak Mahindra Bank
(KMB), YES Bank, and AU Small Finance Bank have reported robust growth in
deposits and advances in the first quarter (Q1FY27), per their provisional
numbers. HDFC Bank’s deposits and gross advances increased by 14.7 per cent YoY
and 15.4 per cent YoY, respectively. The bank’s period end deposits were about Rs.31,70,500
crore as of June 30, 2026, a growth of around 14.7 per cent over Rs.27,64,100
crore as of June 30, 2025, according to regulatory filing by India’s largest
private sector bank.
(Business Line)
ICICI Prudential Life may
drop ‘Prudential’ brand as UK promoter seeks investor status: ICICI Prudential Life
Insurance may undergo a rebranding by dropping the ‘Prudential’ name as one of
its promoters, Prudential Corporation Holdings, seeks to be reclassified from a
‘promoter’ to an ‘investor’. The move could bring to a close a 25-year brand
association that helped make ICICI Prudential one of India’s most recognised
names in life insurance. Prudential Corporation Holdings (Prudential) and ICICI
Bank, the two promoters of ICICI Prudential Life Insurance, on Saturday entered
into a letter of undertaking under which Prudential will apply to the IRDAI to
be reclassified from a ‘promoter’ to an ‘investor’ under the regulator’s norms.
The undertaking also sets out the rights of ICICI Bank and Prudential from the
date of submission of the reclassification application until the proposed
transaction is completed.
(Financial Express)
State Bank of India to buy
10% in RDCL: State
Bank of India (SBI) is set to acquire National Housing Bank’s (NHB’s) 10% stake
in RMBS Development Company (RDCL), a middle-layer NBFC focused on residential
mortgage-backed securitisation. Following the transaction, NHB’s holding in RDCL
will decline to 29% from 39%. “The induction of SBI as a shareholder will
strengthen RDCL, which is being developed as a specialised market intermediary
for mortgage-backed securitisation in India,” said a person familiar with the development.
RDCL was set up in 2024 with a paid-up capital of Rs.500 crore to help deepen
India’s residential mortgage-backed securities (RMBS) market. Its shareholders
include leading banks, housing finance companies, NBFCs and LIC.
(Financial Express)
RBI imposes Rs 66.7 lakh
penalty on Bank of Baroda, GIC Housing Finance: Reserve Bank of India imposed
a penalty of Rs 63.60 lakh on Bank of Baroda after it was found that the bank
had collected a higher rate of interest in certain loan accounts and for not
uploading KYC records onto the Central Records Registry within the prescribed
timeline. “The action is based on deficiencies in regulatory compliance. The
bank had collected interest at a rate higher than the contracted rate in
certain loan accounts. And for non-compliance with certain provisions of
directions issued by RBI on ‘Fair Practices Code for Lenders’ and ‘Know Your
Customer (KYC),” RBI said in a release. In another statement RBI also
imposed a fine of Rs 3.10 lakh on GIC Housing Finance Limited (the company) for
non-compliance with provisions of the KYC norms.
(Financial Express)
Insurance, NPS pump record
Rs 88,852 crore into equities in H1 2026: Insurance companies and the National Pension System
(NPS) have emerged as the key drivers of domestic liquidity in Indian equities,
together investing a record amount in the first half of 2026 since data became
available. The buying has continued despite muted returns from Indian markets
through the year and sustained selling by foreign institutional investors
(FIIs). During January-June 2026, insurance companies
bought equities worth around Rs 45,929 crore while NPS bought around Rs 42,922
crore, taking combined six-month buying to Rs 88,852 crore, a record since data
became available in 2021, NSE data showed.
(Moneycontrol)
India builds AI fallback
amid US export curbs: US restrictions on access to advanced artificial
intelligence (AI) models are beginning to reshape India’s AI strategy, with the
government building independent capability to test critical software and
cybersecurity systems instead of waiting for access to Anthropic’s most
advanced model. The ministry of electronics and information technology (MeitY)
has started using alternative frontier AI models to stress-test critical code
while accelerating work on indigenous frontier models, reflecting a broader
effort to reduce reliance on overseas AI platforms for strategic applications.
The move comes even as India continues to seek access to Anthropic’s Mythos 5
under Project Glasswing, a trusted-partner programme that Washington is yet to
expand.
(Financial Express)
NSE plans to
launch quanto cross-currency derivatives, seeks RBI approval: The National Stock Exchange (NSE) is
planning to launch quanto cross-currency derivatives or quanto derivatives —
and has sought approval from the Reserve Bank of India for the same, according
to the draft red herring prospectus (DRHP) filed with SEBI for its IPO. A
quanto derivative is a financial contract that enables investors to take
exposure to the exchange rate between two foreign currencies, such as the euro
against the US dollar or the UK pound sterling against the dollar, without
directly assuming exchange rate risk in the settlement currency. It tracks the
movement of a foreign currency pair, while profits and losses are settled in a
pre-determined currency under a fixed conversion mechanism.
(Business Standard)
ADB approves $230 million
loan to modernise water supply and sanitation in Chennai: The Asian Development Bank
(ADB) on Friday approved a $230 million loan to modernise and expand Chennai’s
water supply and sanitation infrastructure, benefiting 4.5 million residents in
the Greater Chennai area. The project will construct over 170 km of water
supply pipes and sewer pipes, upgrade seven water pumping stations and 38 sewer
pumping stations, and strengthen water utility assets and operations management
through performance-based contracts, ADB said..
(Business Line)
Shivraj Singh Chouhan
Releases First Installment of Rs.25,863 Crore to States for VB-G-RAM-G: Union Minister for Rural
Development Shri Shivraj Singh Chouhan today reviewed the implementation of the
Viksit Bharat–Guarantee for Rozgar and Aajeevika Mission (Gramin) [VB-G-RAM-G]
through a video conference with Rural Development Ministers of all States and
Union Territories. During the meeting, he released the first installment
(Mother Sanction) of Rs.25,863 crore to the States for implementation of the
scheme.
(PiB)
Prime Minister
launches the Next Phase of UDAN – Viksit UDAN: Launched in October 2016, the UDAN Scheme
has transformed regional connectivity by operationalising 669 routes and
connecting 95 airports, heliports and water aerodromes, benefitting over 1.66
crore passengers. Building on this success, the Union Cabinet, chaired by the
Hon'ble Prime Minister, approved the Modified UDAN Scheme on 25 March 2026 with
an outlay of approximately Rs.29,000 crore over the next ten years to
accelerate aviation-led development and advance the vision of Viksit Bharat
2047. The Modified UDAN Scheme focuses on expanding
regional aviation infrastructure through the development of 100 aerodromes from
existing unserved airstrips with an investment of Rs.12,159 crore. It also
provides Rs.2,577 crore towards Operations and Maintenance support for regional
airports, development of 200 modern helipads with an investment of Rs.3,661
crore, and continued Viability Gap Funding of Rs.10,043 crore to sustain
regional airline operations.
(PiB)
CROWDING OUT EFFECT
·
The Crowding Out Effect is an
economic phenomenon in which increased government borrowing leads to a
reduction in private sector investment by absorbing a large share of available
financial resources. As the government competes with businesses for funds,
interest rates tend to rise, making borrowing more expensive for private firms.
·
The Crowding Out Effect occurs
when government expenditure financed through borrowing increases the demand for
loanable funds, resulting in higher interest rates that discourage private
investment.
RBI KEY RATES
Repo
Rate: 5.25%
SDF:
5.00%
MSF
/Bank Rate: 5.50%
CRR:
3.00%
SLR:
18.00%
FOREX RATES (RBI REF. RATE)
INR
/ 1 USD : 95.2408
INR
/ 1 GBP : 127.4109
INR
/ 1 EUR : 109.1475
INR
/100 JPY: 59.2500
EQUITY INDEX
Sensex:
77763.91 (+261.79)
NIFTY:
24270.85 (+95.15)
Bnk NIFTY: 57938.50 (-93.15)
World Zoonoses Day: World Zoonoses
Day is observed every year on 6 July to commemorate the historic achievement of
Louis Pasteur, who successfully administered the first rabies vaccine to a
human on 6 July 1885. The day aims to raise awareness about zoonotic diseases infectious
diseases that can spread naturally between animals and humans and to promote
preventive measures through collaboration across human, animal, and
environmental health sectors..
Historical events: July 6 marks the
birth of Dr. Syama Prasad Mookerjee (born 1901), India's first Minister of
Industry and founder of the Bharatiya Jana Sangh. In world history, it
commemorates Dadabhai Naoroji's election as Britain's first Indian MP (1892),
the invention of the rabies vaccine (1885), and Malawi's independence (1964).
****Have a nice
Day****
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