Listen to the latest business news by the Financial Express where we talk about Union Cabinet’s new announcement adding to the Rs 76,000-crore incentive scheme for developing the semiconductors and display manufacturing ecosystem in India. We also talk about Amazon and Solar Farms in Rajasthan and look at how the stock market will perform today.

Today’s Latest Business News at 9:30 am on 22nd September 2022

[Disclaimer: This transcript is auto-generated]

Let’s begin. Nine months after announcing a Rs 76,000-crore incentive scheme for development of semiconductors and display manufacturing ecosystem in the country, the Union Cabinet on Wednesday sweetened it further by making the fiscal support of 50% of project cost uniform across all technology nodes for setting up of semiconductor fabs. When the government had first announced the scheme in December 2021, it had extended financial support of up to 50% of project cost for at least two semiconductor and two display fabs for a minimum of six years. For others, like compound semiconductors, sensor fabs etc, fiscal support of 30% was to be offered. Minister of state for IT Rajeev Chandrasekhar said the total outlay for the package will remain the same but harmonisation of incentives to 50% will make the semiconductor policy “extremely competitive” and attract investment across spectrum of opportunities, namely silicon and compound fabs, packaging units, display fabs, and design and innovation ecosystem.
Meanwhile, The Securities and Exchange Board of India diktat on running account settlement is expected to result in outflows of thousands of crores in cash balances of brokers on October 7, impacting trading volumes the next few days and the broking business. According to earlier regulations, brokers had to settle the client’s unused funds lying in the trading accounts at least once in 90 days (every quarter) or 30 days. This was on a rolling settlement basis and referred to as ‘running account settlement’ or ‘quarterly settlement of funds’. The aim was to prevent misuse of excess cash by brokers. Under the new norms, the entire industry has to do the quarterly or monthly settlement on a specific date, which is the first Friday of each quarter or the first Friday of every month. If the first Friday is a trading holiday, such settlement will happen on the previous trading day.
Next up, Industry. Amazon on Wednesday announced it will set up three solar farms in Rajasthan with a combined capacity of 420 megawatt. This will be the first time that the e-commerce major is setting up a solar farm in the country. These would include a 210 MW project to be developed by ReNew Power, a 100 MW project to be developed by Amp Energy India, and a 110 MW project to be developed by Brookfield Renewable Partners, for which power purchase agreements have been signed, it said in a statement. Further, Amazon will also set up 23 new solar rooftop projects – with a capacity to generate an additional 4.09 MW of power — across 14 cities in India. This would increase the company’s total number of solar rooftop projects in the country to 41 with 19.7 MW of renewable energy capacity.
Moving on. In a purported bid to become self-sufficient and reduce reliance on government funds, the Insolvency and Bankruptcy Board of India has proposed to levy a “regulatory fee” of 0.25% of the realisable value to creditors where the recovery is higher than the liquidation value of stressed assets. It has also proposed to impose a fee of 1% of the resolution cost in respect of hiring any professional or for other services. At the same time, the regulator has raised the fees it gets from insolvency professionals, IP entities and the information utility. The new fee structures will come into force from October 1, 2022.
On to economy. With the banking system liquidity slipping into a deficit, the Reserve Bank of India will conduct an overnight variable rate repo auction for Rs 50,000 crore on Thursday. Banks have been borrowing increasing amounts from the marginal standing facility window over the past week or so — on Tuesday they borrowed a little over Rs 30,000 crore, up from Rs 11,000 crore on Monday. Moreover, over the past few sessions, the call money rate has slowly crept past the repo rate — it was 5.6% on Monday and inched up to 5.64% on Tuesday. Bhaskar Panda, Executive Vice President (Overseas Treasury), HDFC Bank said the system was between a deficit and a little surplus. He observed that the outflow on account of advance taxes, the pick–up in credit demand and slower pace of growth in deposits as also the RBI intervention in the forex markets had contributed to the shrinking liquidity.
And lastly, the stock market. The market following weak global cues is expected to open in the red as trends in SGX Nifty indicate a gap-down opening for the broader index in India with a loss of 121 points. The BSE Sensex fell 263 points to 59,457, while the Nifty50 declined 98 points to 17,718 and formed decent bearish candle on the daily charts amid volatility.

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Business News at 09:30 am on 22nd September 2022