Issue: 1137
India-US trade deal sets stage for sustained FPI inflows as
foreign investors return with $897 million: The India-US trade deal is
expected to trigger sustained foreign portfolio inflows into Indian markets as
overseas investors regain confidence in the country’s growth trajectory, with
the week ending February 6, 2026 marking a decisive shift as FPIs turned net
buyers after weeks of relentless selling. Foreign portfolio investors (FPIs)
invested a net $897 million into Indian stocks during the week, according to
data from the National Securities Depository Limited (NSDL), signalling a
potential reversal in sentiment that could gather momentum as bilateral trade
relations strengthen and currency stability returns. The weekly inflow comprised
net equity purchases of $897.15 million, while debt instruments saw net
outflows of $0.13 million. In February through the 6th, FIIs were net equity
buyers to the tune of ?2,645 crore, marking a sharp turnaround from January’s
heavy outflows.
(Business Line)
What are GM crops and why they are a point of concern in US
trade deal?:
The India–US
trade deal has brought agriculture back into the policy spotlight after New
Delhi agreed to grant zero-duty or sharply reduced-duty access to a set of
American farm and food products, while reiterating that its “sensitive” farm
sectors remain protected. Items such as dried distillers’ grains (DDGS), red
sorghum, soybean oil, and select fruits and nuts have drawn particular
attention because they sit close to US agricultural supply chains dominated by
genetically modified crops. Genetically modified crops are plants whose DNA has
been altered using modern biotechnology to introduce specific traits, such as
insect resistance or herbicide tolerance, with greater precision than
conventional cross-breeding. The US is among the world’s largest producers and
exporters of GM crops. This matters for India–US trade because the
American agricultural export basket is dominated by corn- and soybean-linked
products, including animal feed inputs and processed derivatives. According to the joint
statement on the trade deal, India has not opened the door to the most
politically sensitive farm imports, such as US corn and soybeans, while
offering zero-duty or reduced-duty access on select other items. India’s resistance to
importing GM-linked farm products reflects a mix of regulatory caution,
political economy considerations, environmental risk assessment and trade
strategy, rather than a blanket rejection of biotechnology.
(Business Standard)
RBI removes cap on VRR to boost long?term FPI debt investments: The
Reserve Bank of India on Friday unveiled a set of measures to deepen financial
markets, including a major change to the voluntary retention route (VRR) for
foreign investors. By scrapping the Rs 2.5 lakh crore cap and offering greater
operational flexibility, the RBI aims to make long?term FPI participation in India’s bond
market smoother and more predictable. “The VRR has been witnessing active
investment by FPIs, and over 80% of the current investment limit of Rs 2.5 lakh
crore has been utilised. With a view to ensuring predictability about the
availability of investment limits under the VRR and to further increase ease of
doing business, it has been decided that investments under the VRR shall now be
reckoned under the limit for FPI investments under the general route,” the RBI
said. It added that it will provide other operational flexibilities to FPIs,
who invest under VRR.
(Financial Express)
SBI outperforms street expectations; posts its highest-ever
quarterly profit of Rs 21,028 crore: State Bank of India (SBI), the
country’s largest lender, delivered its highest?ever quarterly profit,
supported by strong credit demand, healthy deposit mobilisation and continued
improvement in asset quality. SBI beat
street expectations in the December 2026 quarter, reporting a 24.5% year?on?year rise in net profit to Rs
21,028 crore (Rs 16,891 crore Q3FY25), sharply ahead of Bloomberg’s estimate of
Rs 17,800 crore. On a sequential basis (Q-o-Q), the bank posted a profit growth
of 4.3% from Rs 20,160 crore as on the quarter ended September (Q2FY26).
(Financial Express)
Govt gets financial bids for IDBI Bank stake sale: The financial bids for the
strategic disinvestment of IDBI Bank have been received from the shortlisted
bidders, the Department of Investment and Public Asset Management (DIPAM) said
on Friday, paving the way for the announcement of the winning bidder in the
coming weeks. Fairfax India Holdings, the promoter of CSB Bank, and Kotak
Mahindra Bank are widely seen as the frontrunners in the race for the lender. Emirates
NBD, which was among the shortlisted bidders, is no longer considered a serious
contender after it acquired a majority stake in private sector lender RBL Bank
last year, analysts said.
(Financial Express)
PSU banks’ profit set to cross Rs 2 lakh crore in FY26, says DFS
Secretary Nagaraju: Public sector banks (PSBs) are
on track to post a record combined profit exceeding Rs 2 lakh crore in the
current financial year, Financial Services Secretary M Nagaraju said,
expressing confidence in the sector’s improving financial strength and
resilience. Speaking to PTI, Nagaraju
emphasised that the broader Indian banking system remains robust, supported by
steady credit expansion and healthy deposit mobilisation. Credit growth at PSBs
is running at about 12 per cent this year, which he described as tremendously
“good”, while deposit growth of around 10 per cent is also reasonably very
good.
(Economic Times)
RBI unveils risk-based deposit insurance premium; safest banks
to pay 8 paise per ?100 from April 2026: The RBI on Friday issued the
risk-based premium framework for deposit insurance, rewarding banks that manage
risks better by giving them a discount of up to 33.3% with 8 paise per ?100
being the lowest. All banks now pay the same
premium of 12 paise for every ?100 of assessable deposits, regardless of how
risky or well-managed they are. Banks will be grouped into 4
risk categories-A, B, C and D. Category A banks, considered the safest, will
pay 8 paise per ?100 of deposits; Category D banks will continue to pay current
rate of 12 paise. Risk assessment will be based on audited financial data and
supervisory ratings.
(Business Standard)
Eway bill generation rises 43% in January, the second-highest
ever:
E-way bill
generation rose sharply in January, with total e-way bills generated at 136.83
million, the second-highest monthly level recorded so far. On a year-on-year
(Y-o-Y) basis, e-way bill generation in January grew 42.6 per cent from 95.96
million in the same month last year. The January number was marginally lower
than the all-time high of 138.39 million, which was recorded in the month of
December last year. An e-way bill is a digitally generated document
under the goods and services tax (GST) system that is mandatory for
transporting goods worth more than Rs 50,000 from one place to another, either
within a state or across states.
(Business Standard)
ESAF SFB to apply for universal banking licence after 2 years,
says MD:
Thrissur-based
ESAF Small Finance Bank (SFB) will wait at least two years before applying for
a universal banking licence as it pivots towards secured lending to improve
asset quality and profitability following stress in its microfinance business,
according to Paul Thomas, managing director (MD) & chief executive officer
(CEO), of the bank. “The road map is clear. We have to wait at least two years
to fulfil the criteria given the current situation. It is a wait-and-watch
approach. By then, others will have become established, and we will have
greater clarity,” Thomas said.
(Business Standard)
India-US trade deal: Farmer groups fear backdoor entry of GM
crops via DDGS: Farmer
groups and opposition parties on Saturday expressed apprehensions over the
permission for cheap imports of dried distillers’ grains with solubles (DDGS)
under the India-USA interim framework agreement, terming it a 'backdoor entry'
for genetically modified (GM) crops into India. They claim this will harm
soybean farmers despite Commerce Minister Piyush Goyal clarifying that DDGS
will be imported under a quota and will be free of GM components
post-processing.
(Business Standard)
Listing rules on corporate governance to prevail over RBI’s for
listed banks, clarifies SEBI: SEBI has clarified that listed
entities, including public sector banks, must place their quarterly corporate
governance compliance reports before the full board of directors and cannot
delegate this responsibility to board committees such as the audit committee. The
clarification came through an informal guidance issued to Punjab National Bank
(PNB), which had sought SEBI’s interpretative view on compliance with
Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015. PNB had argued that the Reserve Bank of India’s Commercial
Banks – Governance Directions, 2025 allow public sector banks to assign certain
matters, including compliance with statutory and regulatory requirements, to
committees of the board so that the board can devote greater attention to
strategic issues.
(Moneycontrol)
UIDAI completes over 10 mn biometric updates for children in 83K
schools: Aadhaar custodian UIDAI has completed
mandatory biometric updates (MBU) for one crore school children covering 83,000
schools across the country, an official statement said. A child under the age
of five can enrol for Aadhaar by providing the photograph, name, date of birth,
gender, address and birth certificate but the fingerprints and iris biometrics
of a child are not captured for Aadhaar enrolment below the age of five as
these indicators are not mature by then. Therefore, providing fingerprints and
iris information in Aadhaar by following the process of MBU, upon crossing the
ages of 5 and 15 years, is an essential requirement for children.
(Business Standard)
Dried distillers’ grains with solubles (DDGS)
§ This
substance remained a point of discussion in recent US-India Trade deal causing
fear among Indian farmers.
§ Dried
Distillers’ Grains with Solubles (DDGS) is a high-protein (approx. 38–45%),
nutrient-rich byproduct of ethanol production (mostly corn), commonly used as a
cost-effective, high-energy livestock feed for cattle, poultry, and swine.
§ It
is derived from fermented, distilled grains and is a valuable, digestible
source of protein, fat, and phosphorus.
§ The
U.S. is a major producer and exporter of DDGS.
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 : 90.4163
INR /
1 GBP : 122.7431
INR /
1 EUR : 106.6864
INR
/100 JPY: 57.6400
EQUITY INDEX
Sensex: 83580.40 (+266.47)
NIFTY: 25693.70 (+50.90)
Bnk
NIFTY: 60120.55 (+56.90)
Historical events: February 9th
marks major historical milestones, including the 1757 Treaty of Alinagar in
India, the 1951 start of India's first census, and the 1971 return of Apollo
14. Key deaths include Baba Amte (2008), while significant events include the
1946 Royal Indian Navy mutiny and the 1964 introduction of G.I. Joe..
****Have a nice
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