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Amazon Commits ₹2,000 Crore to Upgrade Delivery Network and Tech Systems in India
Economy, Markets - April 12, 2025

Tariffs Ahead: Amazon CEO Warns of Impact on Every American Wallet

Tariffs Ahead: Amazon CEO Warns of Impact on Every American Wallet

 

Andy Jassy sounds the alarm on Trump-era tariffs, stating that rising import costs—especially on Chinese goods—will inevitably lead to higher prices for millions of U.S. consumers, with ripple effects across the entire retail sector.

Introduction
Amazon CEO Andy Jassy has issued a stark warning to American consumers: the full effects of tariffs imposed during Donald Trump’s presidency are only starting to be felt, and they could lead to widespread price increases across nearly every household item sold on Amazon. With over 70% of the e-commerce giant’s products sourced from China, Jassy emphasized that the cost burdens on sellers and retailers are mounting—and will soon be passed directly to buyers.
In what many call a reality check for shoppers and policymakers alike, Jassy’s remarks come amid growing economic concern over inflation, supply chain instability, and the U.S.-China trade rift. According to Jassy, “This is just the beginning,” hinting at the broader and deeper economic pain consumers could face if tariff policies continue unchecked.

The Heart of the Concern: China Tariffs
While in office, former President Donald Trump enacted a range of tariffs on Chinese goods as part of his overall strategy in the trade war.. While some of those measures have been maintained or restructured under the Biden administration, the original tariffs continue to impact thousands of goods—from electronics and home appliances to clothing, toys, and furniture.
Amazon, which relies on a vast network of *third-party sellers—many of whom import directly from China—*has been particularly vulnerable. These sellers are already seeing their profit margins squeezed, and many are now considering price increases or product discontinuations to remain viable.
“The reality is that sellers can’t absorb these costs forever,” Jassy said.

Immediate Shopper Reactions: Panic Buying and Pre-Hike Orders
Retail analysts have noticed an uptick in pre-emptive purchasing behaviour. Shoppers, fearing imminent price surges, are reportedly stocking up on everyday essentials, electronics, and even seasonal goods ahead of time. Several popular categories, including kitchen appliances, power tools, and gadgets, have already seen small but noticeable price hikes on the platform.
Retail tracking firms have also identified delivery lead times increasing and inventory fluctuations, indicating sellers are reassessing their supply chain strategies in anticipation of prolonged economic uncertainty.

Third-Party Sellers Sound the Alarm
Amazon’s third-party sellers, who contribute to more than 60% of the platform’s total merchandise sales, are voicing concern over their long-term sustainability. Many small and medium-sized businesses (SMBs) operate on razor-thin margins and are now facing a harsh reality: either raise prices and risk losing customers or absorb costs and risk shutting down.
Several sellers have also highlighted increasing freight costs, port delays, and higher fees from Chinese suppliers—creating a perfect storm for a surge in end-consumer prices.

Wider Economic Ramifications
Jassy’s warning echoes a broader sentiment in corporate America: trade tensions and protectionist policies, while aimed at securing domestic interests, often result in higher consumer costs and reduced global competitiveness. As inflation remains a hot-button issue in the U.S., these tariff-related pressures could exacerbate the financial strain on low—and middle-income households.
“From grocery staples to electronics, no sector is immune if these tariffs remain in place or expand,” said Jennifer McAllister, a retail policy expert at the American Economic Institute. “We’re not just talking about Amazon—we’re talking about Walmart, Target, Best Buy, and beyond.”

What Can Consumers Expect Moving Forward?

With the 2024 U.S. presidential election cycle heating up and trade policy expected to be a key debate topic, the future of these tariffs remains uncertain. However, Jassy’s comments suggest that Amazon is preparing for a “new normal” in global trade, where price hikes become standard and cost optimization becomes paramount.
Some possible changes consumers may notice in the coming months include:
Gradual increase in product prices, especially in high-import categories
Reduced availability of certain low-cost Chinese goods
Shift in sourcing strategies, with more sellers exploring India, Vietnam, and Latin America
Fewer discounts and flash sales, as sellers buffer their margins

 

 

 

 

 

 

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Elon Musk’s Robotic Dream Team: Laying the First Bricks on Mars

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HAL Gains Momentum as Analysts Predict Strong Growth Potential
Economy, Markets - April 11, 2025

City Hustle, Town Rearrange: India’s Work Scene Gets a Modest Makeover!

City Hustle, Town Rearrange: India’s Work Scene Gets a Modest Makeover!

India’s work advertise has continuously been a bit like a Bollywood movie—full of turns, ups and downs, and shocks when you slightest anticipate them. The most recent government report has dropped a few curiously upgrades, appearing that between 2023 and 2024, urban ranges saw a small boost in work interest, whereas country locales had a bit of a blended sack. Let’s break it down, one subplot at a time.

Urban Zones: More Hands on Deck

City people are venturing up! Agreeing to the Intermittent Work Constrain Study (PLFS), the Work Constrain Support Rate (LFPR) in urban India rose to 60.1% in 2023–24, up from 57.9% the year before.
So, what does that really cruel? Well, more individuals in the city are either working or effectively looking for work. Whether it’s snatching a portable workstation in a coworking space or taking a move in retail, more hands are joining the urban workforce. This uptick is a positive sign. It appears certainty in the work showcase. Individuals don’t by and large go work chasing unless they accept there’s something out there for them.

Urban Unemployment: A Slight Dip
Here’s a few more great news: urban unemployment dropped to 5.1%, from 5.4% the past year. That implies more city tenants are really landing occupations. Not a gigantic alter, but hello, advance is progress!
So perhaps that nourishment conveyance fellow zipping past you or the lady running your favourite neighbourhood boutique is portion of this unused wave of urban work. The point is—things are looking up, indeed if fair a little.

Provincial India: A Inquisitive Case
Now let’s bounce over to the wide open. In country India, the work scene had both a few cheers and a few frowns. First, the great portion: the Work Drive Cooperation Rate in country zones bounced to 63.7%, up from 60.8%. That’s very a jump! It implies more villagers are venturing out to work or at slightest looking for jobs—perhaps in horticulture, little businesses, or neighbourhood services. But here’s the capture: provincial unemployment ticked up marginally to 2.5%, from 2.4% the year some time recently. Not a colossal rise, but it does appear that finding employments in country zones is still not as simple as joining the city grind.

Ladies Take the Lead
One of the most cheering stories in this information dramatization is almost women.
The female LFPR for ages 15 and over rose to 41.7%, compared to 37% the past year. That’s a strong bounce, and it implies more ladies are entering the workforce than before—whether in tech, instructing, fitting, or tending their claim startups.
However, there’s a flip side. Female unemployment too crawled up somewhat to 3.2%, from 2.9%. So whereas more ladies are saying, “I’m prepared to work,” not all of them are finding occupations fair however. Still, it’s a step in the right heading, and with more center on ability improvement and comprehensive enlisting, we might see that number improve.

So, Why the Change?
Several components might be behind these unpretentious shifts:
1. Post pandemic recuperation: Numerous businesses, particularly in urban zones, are back in full swing.
2. Government plans: Activities like Startup India, Aptitude India, and provincial business programs are pushing individuals to work or begin something new.
3. Computerized get to: With more web infiltration, indeed rustic youth are investigating online work, gig employments, and upskilling platforms.
4. Urban movement: A few provincial laborers move to cities looking for way better openings, boosting urban participation.

The Street Ahead: Bumpy but Promising
Let’s not get carried away—it’s not all rainbows and pay checks fair however. Whereas these numbers are empowering, they moreover tell us that:

1. Provincial India still battles with work creation.
2. Female interest is developing but needs more grounded support.
3. A huge casual division implies numerous occupations stay come up short on or unstable.
But here’s the silver lining: India’s workforce is appearing development. And development implies momentum.

Last Considerations: A Little Move with Enormous Hopes
Think of India’s work showcase right presently as a monster chessboard. The pieces are starting to move—slowly, mindfully, but unquestionably. Urban India is hustling harder, more ladies are entering the amusement, and country people are not sitting still either.
These little shifts might not appear like much at to begin with look, but they carry huge potential. With the right approaches, preparing, and financial solidness, this can clear the way for a more dynamic and comprehensive work advertise in the a long time to come.
So the following time you spot a active conveyance rider, a unused shop in your neighbourhood, or a youthful villager propelling their claim YouTube channel—remember, they’re all portion of India’s everchanging, ever hustling work drive story.
Because in the conclusion, whether it’s city lights or town paths, everyone’s fair attempting to make a living—and perhaps, fair perhaps, live a small way better as well.

 

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TCS Salary Hikes on Hold

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business update, Economy, Equities, Markets - April 11, 2025

TCS Salary Hikes on Hold

TCS Salary Hikes on Hold
in India

 

Pay Increase Postponed Due to Financial Hardships

India’s largest IT outsourcing firm, Tata Consultancy Services (TCS), has indicated a delay in its roll-out of year-on-year salary increases for 2025. The initiative, indicated by the company at its post-results press conference on Tuesday, comes in the aftermath of the firm facing tough macroeconomic conditions alongside a negative world business environment amid the escalating tariff tensions between the US and a number of its trade partners.
TCS CHRO Milind Lakkad confirmed the news, saying, “We will decide in the year when to give the wage hike.” This is a conservative, wait-and-watch strategy by the IT major, which is fighting a tougher operating environment. Amid growing concerns about global inflation and market volatility, many Indian IT firms are adopting similar caution.

When Will the Hike Take Place?

While the hikes were initially scheduled to be implemented in April as per the financial year cycle, the TCS management has now decided to postpone the timeline. The implementation will be undertaken later in FY26, only after there is more stability and clarity in the overall macroeconomic environment.
In spite of such deferments, the compensation focus remains at the forefront, the company asserted. TCS should still be providing variable compensation to the employees, thereby easing the blow for the employees. Employees with high performance metrics or those in critical functions may still see steady rewards in the near term.

Quarterly Variable Pay Still Active

Lakkad said that 70% of the company’s staff will receive their full-eligible fourth-quarter variable pay. The remaining 30% will receive pay based on business unit performance. The framework allows the company to pay the top performers while it is being conservative during good times.

Attrition Rises But in Check

As of Q4FY25, the firm attrition rate for talent was 13.3% over the previous 12 months.
Even a notch higher than before, Lakkad was optimistic: “Attrition has increased a wee bit to 13.3% this quarter. We are fine because our quarterly annualized attrition has reduced this quarter by 130 basis points. So, we should be fine.”
He explained that although attrition is a number to monitor, it has progressively improved, indicating a broadly consistent body of employees within an available talent pool. He also promised that attempts at employee engagement have been scaled up to accommodate retention.

FY26 Hiring Opportunities: Improved or Better

In the recruitment plans, TCS does not anticipate any slowdown to occur. Lakkad said the recruitment numbers for FY26 for the company would be comparable to or even higher than those of FY25. That is in line with TCS’s longer-term plan of having a strong bench of talent to be deployed whenever the demand picks up.

A little increase in headcount is recorded.
TCS’s workforce has grown to a total of 607,979 employees, following the recruitment of 6,433 new team members during the final quarter of FY25. Compared to the 601,546 employees it had on hand as of Q3FY25, that is a slight increase. A phased approach to recruitment suggests that the company is looking to the future without sacrificing its operational discipline.

Q4FY25 Performance: Revenue Growth, Small Profit Loss

In Q4FY25, TCS reported a net profit of ₹12,224 crore, 1.69% lower than the year before.
Nonetheless, operating revenue rose to ₹64,479 crore, a 5.29% increase over the previous quarter’s ₹61,237 crore.
The marginal fall in profit is indicative of industry-wide cost pressures and slowing ramp-ups of deals, while revenue growth was stable. The company is, however, financially strong, with strong cash flows and good customer relationships. Management remains hopeful about medium-term deal conversions and better utilization levels ahead.

Industry-Wide Implications

TCS’s move to postpone salary increases is being seen as a trendsetter for the overall IT services industry, where organizations are facing delayed client expenditure, geopolitical policy risks, and inflation. Other players in the industry will follow if the external situation does not change in the near future.

Last Takeaway: Strategic Pause, Not a Freeze

Although the employees may be frustrated by the delay in salary increases, it is TCS’s conservative strategy to ride out short-term fluctuations without jeopardizing long-term ones. With variable pay already in place, headcount increasing, and hiring plans intact, the company is definitely trying to balance people and profits.

 

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Transforming ₹1 Lakh into ₹1.8 Crore: The Unbelievable Journey of Two Stocks

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Microfinance sector recorded surge in NPAs to Rs. 50000 crore
Banking, Business, Equities, Markets - February 27, 2025

Microfinance sector recorded surge in NPAs to Rs. 50000 crore

Microfinance sector recorded surge in NPAs to Rs. 50000 crore

 

Microfinance sector in India recorded non-performing assets (NPAs) of Rs. 50,000 crore at the end of December, 2024. The NPAs of the microfinance sector is about 13 percent of the gross credits. Despite the efforts of RBI to mitigate risk by lowering capital allocation requirements for risky unsecured loans, the NPAs of the microfinance sector hit an all-time high record of Rs. 50,000 crore.

 

Hike in portfolio at risk (PAR)

The portfolio at risk which could convert into NPA surged to 3.2 percent of the total credit. It was only 1 percent last year. Overall scenario of the microfinance loan portfolio indicates serious concerns about the credit discipline prevailing in the sector. 

 

Cautious Approach

In the midst of a hike in NPAs and the portfolio at risk in the microfinance segment, industry leaders in the market are looking at the future with a careful approach. Managing director of IndusInd Bank, Sumant Kathpalia said that the bank continues to have a prudent approach in terms of the microfinance segment. He stated that the bank’s customer base is indicating early signs of stability and it will be highlighted in the first quarter of the financial year 2026. Though, there is a probability of a rise in slippages in the upcoming quarter of the financial year 2025. 

 

Total share of NPA in microfinance segment

According to the information of Crif High Mark, the total proportion of NPAs, which are due for more than 90 days in the microfinance segment, is about 13 percent.  The total credit not paid for about 91 to 180 days accounts to 3.3 percent of the total loans. Also, the loans not paid for more than 180 days are recorded at 9.7 percent of the total loans.

 

The information does not include the data for the previous six months. It is likely for NPAs of the microfinance sector to hike to 14 percent of total loans or Rs. 56,000 crore, if the previous six months’ data is added to it. 

 

Performance of microfinance sector

In the past three quarters of the financial year, the microfinance sector in India recorded contraction in growth. Even though lenders tried to clean up their financial records by writing off bad assets. Another reason for this subdued performance is giving too many credits to low-income borrowers in order to achieve high growth quickly. It led to further expansion in defaults in the microfinance sector. 

 

Microfinance credit is generally given to women from low-income households with income less than Rs. 3 lakh on yearly basis. These loans usually do not have any collateral leading to becoming risky in terms of economic issues. 

 

Effect on Financial institutions and banks

The hike in NPAs in the microfinance sector indicates high risk for banks largely operating in unsecured lending segments. Though, every unsecured credit does not come in the microfinance sector. Some of the banks with large unsecured loans and currently facing high pressure in the loan segment are IDFC First, RBL Bank, Bandhan Bank, and IndusInd Bank. In the past, Bandhan Bank was a microfinance institution which later changed into a universal bank. At the present times, the bank has about Rs. 56,120 crore of unsecured loan portfolio and 7.3 percent of these unsecured loans are NPAs at the end of December, 2024. 

 

Recently RBI took the decision to lower capital requirement on micro loans given to MFIs to about 75 percent, which was earlier 125 percent. It aided in releasing more capital for creditors to lend and expand their businesses. The unsecured loans offered for the purpose of consumption remain at 100 percent of capital requirement.

 

Major Concerns of small finance banks and NBFCs

Due to the rising NPAs and potential risk of NPAs in microfinance lending, small finance banks like Utkarsh and ESAF recorded net losses in the third quarter. Small finance banks like Ujjivan, Equitas, Jana, and Suryoday recorded contraction in net profits by about 64 percent, 67 percent, 18 percent, and 42 percent on YoY basis, respectively, in the third quarter.

 

In terms of NPAs in microfinance loans in universal banks is recorded to be around 15.7 percent. On the other hand, total NPAs in microfinance loans in small finance banks stood at 18.3 percent. 

 

NBFC-MFIs like Spandana and Fusion broke their financial agreement due to recording quarterly losses in a row. The main reasons for these losses were expansion in the number of bad loans and hike in funding costs. 

 

In the past, the microfinance sector acted as a main driver for financial inclusion in the economy. It is now facing serious concerns as lenders are unable to balance both asset quality and growth of the finance institutions. 

 

 

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Easing of risk weights on loans given to MFIs and NBFCs
Banking, Business, Equities, Markets - February 26, 2025

Easing of risk weights on loans given to MFIs and NBFCs

Easing of risk weights on loans given to MFIs and NBFCs

 

On 25th January, 2025, Reserve Bank of India (RBI) lowered the capital requirement leading to easing up of giving micro loans and loans to microfinance institutions (MFIs) and non-banking finance companies (NBFCs).  RBI lowered the risk weight to 100 percent for NBFCs. These new regulations will come into effect from 1st April, 2025. The main aim of the Reserve Bank of India is to increase liquidity, better loan flows, and also boost growth in the economy. 

 

Actions taken by RBI

In order to support economic growth, RBI declared a contraction in policy rate by 25 basis points which accounts to 6.25 percent on 7th February, 2025. In less than a month, RBI took the decision of lowering the capital requirement against loans given to NBFCs and MFIs. 

 

Prior to this, the risk weights on bank credits to Non-Banking Financial Companies (NBFCs) was expanded to 125 percent from 100 percent.  The reason for the implementation of this action was to limit unsecured loans, which had expanded to 25 percent in the month of October, 2023. Following expansion in risk weight, NBFCs faced high borrowing costs leading them to demand for relief. 

 

The recent decision of the RBI restored the risk weights on credits to NBFCs back to 100 percent. It will not only lead to expansion in liquidity but also lower borrowing costs for NBFCs giving them relief from the persistent concerns about high borrowing costs.

 

Impact of actions taken by RBI

The recent steps of RBI to lower capital requirement will lead to capital of around Rs. 40,000 crore more available for the banks. The banks can now give credit up to Rs. 4 lakh crore to AAA-rated entities. It will lead to lower funding costs,  rise in liquidity, and better margins for institutions. Its goal is to have strategic growth in the economy and to resolve the issue of subdued bank loans to NBFCs.

 

Changes in risk weight on loans to MFIs

Prior to this decision, banks had to have a capital requirement of 125 percent on loans given to MFIs. The aim of this regulation was to lower potential risks. It made lending to MFIs expensive. 

 

In a recent decision of RBI, the risk weight is assigned to be 75 percent on loans given to MFIs which will encourage more credit to MFIs. The loans given for consumption purposes are assigned a risk weight of 100 percent.

 

Reasons for lowering capital requirement 

The decision of RBI to restore risk weight highlights that potential risk prevailing in the economy of unsecured credit has contracted. The previous measures of RBI to expand risk weight has helped the economy and the banking sector. Though, it affected NBFCs, particularly small NBFCs as they faced the issue of high funding costs. Many large NBFCs had to keep their liquidity levels high in order to have enough funds to maintain lending activity.

 

In the current financial year, the bank loans to NBFCs are recorded to be sluggish. Also, contraction in liquidity in the market was observed. These are reasons why RBI lowered capital requirements and also to prioritise loan flow to under-served segments for growth in the economy. 

 

It is now time for the economy to target strategic economic growth. It will give more access to funds leading to strong growth in the sector. 

 

Benefit to banks

The change in regulations of RBI will not only help MFIs and NBFCs but also banks in the sector. The credit system of NBFCs generally functions by taking loans from banks and then using that loan amount to give loans to its customers. The lowering of capital requirement will likely lead to lower interest rate to NBFCs by banks. It will lower the funding costs of NBFCs. 

 

Bandhan Bank is considered to get more gains as a quarter of its portfolio used to attract 125 percent risk weight but now it will attract 75 percent risk weight. It will aid the bank to lend more as it will have more capital to give credit. It will lead to improvement in its profit margins.

 

In conclusion, the main aim of the RBI is to have strategic growth by lowering funding costs and improvement in margins for the sector. It also gives relief in terms of loans given to NBFCs and MFIs and addresses the issue of subdued bank credits to NBFCs. 

 

 

 

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Nasdaq and S&P 500 dip in the midst of AI worries

 

 

 

 

 

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Easing of risk weights on loans given to MFIs and NBFCs
Banking, Equities, Markets - February 25, 2025

Easing of restrictions on New India Co-operative Bank

Easing of restrictions on New India Co-operative Bank

 

Overview

With effect from February 27, 2025, the Reserve Bank of India has loosened restrictions on New India Co-operative Bank, permitting withdrawals of up to Rs 25,000. This comes after the bank’s liquidity status has been evaluated. The general manager of the bank was also taken into custody on suspicion of embezzling Rs 122 crore.

 

Depositors can withdraw

Starting February 27, the Reserve Bank of India (RBI) has permitted ₹25,000 withdrawals to depositors of the fraud-plagued New India Cooperative Bank, providing some respite. More than half of all depositors would be able to withdraw their full balances with the aforesaid relaxation, and the remainder depositors will be allowed to withdraw up to ₹25,000 from their accounts, according to the RBI.

 

Depositors can make this withdrawal using the bank’s ATM channel or in-branch. It was explained, however, that the total amount that any depositor may withdraw will be ₹25,000 or the amount that is available in their account, whichever is less.

 

With effect from February 25, the RBI has also reorganized the Committee of Advisors (CoA) to the Administrator. CoA members include former State Bank of India general manager Ravindra Sapra, former Saraswat Co-operative Bank Ltd. deputy general manager Ravindra Tukaram Chavan, and chartered accountant Shri Anand M. Golas. However, the Administrator has not changed.

 

RBI had issued AID

As a precautionary step to safeguard depositors’ interests, the RBI issued All Inclusive Directions (AID) to the bank on February 13, 2025, prohibiting any withdrawals from current, savings, and other accounts. The central bank then replaced its Board on February 14, 2025, and established an Administrator and a Committee of Advisors (CoA) to supervise the situation and guarantee the stability of the bank.

 

The RBI was developing a proposal to permit extraordinary withdrawals for personal and medical situations for depositors of the financially troubled New India Co-operative Bank. In the event of a bank failure, savings up to Rs 500,000 are guaranteed under present regulations, and payouts must be given within 90 days. A request for comment was not immediately answered by the RBI.

 

Citing worries about the bank’s financial condition and ongoing supervisory challenges, the RBI placed severe limitations on the bank last week, forbidding it from issuing new loans, suspending deposit withdrawals for six months, and designating an administrator.

 

Story so far

On February 17, Hitesh Mehta, the bank’s general manager and head of accounts, was taken into custody on suspicion of embezzling Rs 122 crore. Mehta admitted to giving a real estate developer Rs 70 crore to finance an SRA (Slum Rehabilitation Authority) project in Charkop, Kandivali, according to a police official.

 

Mehta and developer Dharmesh Paun were detained in connection with the investigation and placed under police prison until February 1, 2025.  The bank’s interim CEO, Devarshi Ghosh, filed the case at the Dadar police station on Friday. The Mumbai police’s Economic Offences Wing (EOW) took over the case after the complaint was filed, and it is currently investigating the alleged theft at the bank’s Prabhadevi and Goregaon branches.

 

Conclusion

Thus, the RBI is supporting the New India Co-operative Bank and its depositors by easing restrictions. The checking of the bank’s liquidity position has yielded positive results. This increased facility has given relief to depositors as above 50% of them are able to access all of their funds while some of them are permitted to withdraw Rs 25,000. Steps have also been taken to restructure the bank by changing the Committee of Advisors and placing the administrator under active oversight. This comes after the recent arrest of the bank’s general manager, Hitesh Mehta, for suspected embezzlement of funds to the tune of 122 crore rupees, thus exposing shocking levels of corruption and internal inquiry into the financial mismanagement. Despite challenges, the RBI aims to balance the interests of the depositors and restore order to the meandering waters of financial chaos still looming around the bank.

 

 

 

 

 

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Hike in limit on small-value credits of Urban co-operative banks

 

 

 

 

 

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Hike in limit on small-value credits of Urban co-operative banks
Banking, Equities, Markets - February 25, 2025

Hike in limit on small-value credits of Urban co-operative banks

Hike in limit on small-value credits of Urban co-operative banks 

 

 

On 24th February, 2025, Reserve Bank of India made an announcement regarding raising the credit limits for urban co-operative banks (UCBs). It stated that the UCBs can now classify their loans of up to 0.4 percent of Tier I capital or Rs. 25 lakh in category of small-value credits based on whichever of them is higher. The limit of the loans per borrower is increased to Rs. 3 crore which was earlier Rs. 1 crore per borrower.

 

Changes in regulations for UCBs

In the past, the classification criteria of small-value loans for UCBs was credit up to Rs. 25 lakh or around 0.2 percent of Tier I capital. The limit of the loans per borrower was about Rs. 1 crore.

 

Reserve Bank of India made changes in the classification of small-value loans of UCBs making it more flexible. It has raised the ceiling limit of loan to Rs. 3 crore per debtor. It also gave the right to categorize loans as small-value loans in case of loans of up to 0.4 percent of Tier I capital or Rs. 25 lakh. These changes in norms will be applicable by immediate effect. 

 

UCBs in India can now categorize big loans as small-value credits as well. This announcement of RBI came following the business restriction on New India Co-operative Bank and also the board of the bank was superseded. The reason for this is lack of governance in the bank.

 

Changes in regulations of Housing loans

Apart from increasing the limit on small-value credits, RBI has taken steps to increase the total exposure limit for residential loans to around 25 percent of its total credits and advances. It allowed UCBs to now allocate a bigger portion of their loan portfolio for residential mortgages. Except for housing loans, the exposure of UCBs in the real estate sector is limited to 5 percent of their total loans and advances. It highlights RBI’s actions to diversify loan portfolio as well as make it balanced. 

 

Reserve Bank of India has made some changes in the limits on residential loans for individuals for various tiers of UCBs. These new changes are in the band of Rs. 60 lakh to Rs. 3 crore. According to central bank of India’s information, the limits on housing credits for individuals in tier-I and tier-II are Rs. 60 lakh and Rs. 1.40 crore, respectively. The limit for tier-II and tier-IV are Rs. 2 crore and Rs. 3 crore, respectively. 

 

Extension of timeline for provisioning on security receipts

Reserve Bank of India extended the time limit for keeping aside money for investments in security receipts (SRs). Earlier, the time limit was till the financial year 2025-2026. The time limit is extended till the financial year 2027-2028. It will aid in UCBs having a substantial amount of time to comply with the regulations and also manage their finances better. Despite this extension, the provisions made for the specified SRs earlier should be maintained in the future as well.

 

In the previous financial year, RBI extended the timeline to achieve the target of minimum percentage of small value credits in the total loans and advances of the UCBs until March 2026. 

 

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Hindalco Industries plans to invest Rs. 15000 crore in Madhya Pradesh

 

 

 

 

 

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Hike in limit on small-value credits of Urban co-operative banks
Banking, Equities, Market News, Markets - February 24, 2025

Personal Loan Growth contracted to 13.7 percent in the third quarter of FY25

Personal Loan Growth contracted to 13.7 percent in the third quarter of FY25

 

Overview

Personal loan growth has slowed to 13.7% by December 2024, down from 15.2% in September, due to regulatory warnings. Total bank credit growth also slowed, despite the fact that all population categories continued to rise by double digits. Lending for commerce, finance, and professional services increased, while credit for agriculture and manufacturing remained stable.  Aggregate deposits increased by 11%, with term deposits showing significant growth.

 

Personal Loan Growth slowed down

Personal loan growth slowed in the December quarter due to regulatory concerns about potential overheating. According to quarterly data from the Reserve Bank of India, the annual growth rate for the personal loan segment was 13.7% in December 2024, down from 15.2% in September. Total bank credit growth also slowed to 11.8% in December 2024, down from 12.6% in September.

 

Further, at the end of January this year, RBI released key data according to which, bank lending to the personal loan segment moderated in December to 14.9% year on year, owing mostly to a reduction in growth in other personal loans, vehicle loans, and credit card outstanding. The RBI has issued statistics on sectoral bank credit deployment for December 2024, which was collected from 41 select commercial banks and accounts for approximately 95% of total non-food credit deployed by commercial banks.

 

The banking regulator stated that all population categories in rural, semi-urban, urban, and metropolitan branches of banks experienced double-digit credit growth, albeit with some slowdown which was true for both public and private sector banks.

 

Credit distribution

Previously, the RBI had presented that the growth in non-food bank credit as of the fortnight ending December 27, 2024, slowed to 12.4% on a year-over-year (y-o-y) basis from 15.8% in the same fortnight the year before. The data showed that bank lending to agricultural and related businesses increased by 12.5% year over year as of the fortnight ending December 27, 2024, compared to 19.4% for the same fortnight the year before.

 

Additionally, industry credit growth stayed relatively constant at 7.4% annually. Out of all the major industries, food processing, petroleum, coal products and nuclear fuels, and all engineering had the highest growth rates. Nonetheless, the infrastructure segment’s credit growth slowed.

 

Further, credit growth in the services sector also slowed to 13.0% year-over-year as of the fortnight ending December 27, 2024. For the equivalent two weeks of the prior year, the growth was 20%. The primary trigger of the moderation was the slower expansion of lending to trade segments and non-banking financial companies (NBFCs). However, credit growth for professional services and computer software increased year over year.

 

Recently, RBI stated that the credit to agriculture and industry sectors also saw some slowing in growth, while lending to commerce, finance, and professional/other services increased in the third quarter. About half of the loans granted by banks had interest rates ranging from 8% to 10%, while approximately 16% had interest rates less than 8%. According to the RBI, the remaining loans carried interest rates of 10% or above.

 

Deposits saw an uptick

Meanwhile, aggregate deposits increased by 11% in December 2024, compared to an 11.7% rise a quarter earlier.  Granular data revealed that approximately 80% of incremental term deposits mobilized between April and December 2024 were held in the one to three-year maturity bucket, indicating a potential lag in the softening of banks’ deposit costs. The proportion of total term deposits with an interest rate of 7% or more climbed from 61.4% to 70.8% by December 2024.

 

Term deposits increased 14.3% year on year, while savings deposits increased by 5.1%.  This resulted in a further increase in term deposits’ percentage of total deposits to 62.1% at the end of December, up from 60.3% the previous year.

 

Q3FY25 Banking Sector Performance

The banking industry reported a mixed quarter, with modest business momentum, high credit costs, and moderate margins. As observed in both public and private sector banks, the growing cost of deposits and heightened competition for funds contributed to the ongoing reduction in net interest margins (NIMs). All segments saw a slowdown in credit growth, with corporate lending recovering slowly as a result of a muted capital expenditure cycle and pressure on large-ticket loan prices.  Risks associated with asset quality are still a major worry, especially in unsecured lending, where personal loan and microfinance portfolio slippages are still common.

 

Systemic credit offtake as of December 31, 2024, was INR 175.9 trillion, representing an 11.3% YoY growth rate that is lower than the 12.6% growth rate from the previous year (excluding merger impact).  Our coverage’s overall credit growth stayed modest at about 10.3% year over year. Secured lending, such as home, auto, and SME loans, drove expansion in retail credit, which continued to grow albeit at a slower rate. A slowdown in unsecured lending, which includes credit cards, personal loans, and microlending, was brought on by tighter regulations, increased risk perception, and an increase in delinquencies. HDF Commercial Bank continues to show a modest gain of 3.0% YoY (+0.9% QoQ), while Bandhan bank led the growth with 15.6% YoY (+1.1% QoQ).

 

Conclusion

To sum up, legal measures led to a decrease in the growth rate of personal loans in December 2024. The expansion of bank credit also moderated.  The lending development to professional services, finance, and commerce grew while Manufacturing and agriculture remained stable.  Investor’s shifts in their preferences resulted in deposit growth, especially term deposits.  The banking industry had mixed results during Q3FY25 so far with concerns regarding asset quality, most notably in unsecured lending, loan growth has slowed with a shift toward an emphasis on secured lending, which is a more positive quality for the industry.

 

 

The image added is for representation purposes only

India’s Ports Sector to increase capacity by the financial year 2028

 

 

 

 

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Port of Los Angeles Records Significant Drop in Imports Due to U.S. Tariff Impact
Economy, Equities, Market News, Markets - February 24, 2025

India’s Ports Sector to increase capacity by the financial year 2028

India’s Ports Sector to increase capacity by the financial year 2028

 

Industry Overview

India’s ports play a crucial role in its trade and economy, accounting for 95% of export volumes and 70% of export values. India has 13 major ports and more than 205 designated minor and intermediate ports. Indian ports and the shipping industry are critical to the country’s economic progress. India is the world’s sixteenth-largest marine country, with 7,516.6 km of coastline and 20,275 km of national waterways throughout 24 states. This posture aligns India with 80% of the global maritime oil traffic, highlighting its potential to become a significant maritime player.

 

The Indian government plays a vital role in assisting the port industry and has permitted Foreign Direct Investment (FDI) of up to 100% through the automatic route for port and harbor building and maintenance projects. It has also provided a 10-year tax break for businesses that construct, maintain, and operate ports, inland waterways, and inland ports.

 

In FY24, all major ports in India handled 817.97 million tonnes (MT) of cargo volume, up 4.45% from 784.305 million tonnes in FY23. India’s merchandise exports in FY23 reached $451 billion, up from $417 billion the previous year. The government has implemented many initiatives to improve operating efficiency, including mechanization, deepening the draft, and expedited evacuations.

 

Capacity in increase by FY28

According to Motilal Oswal Financial Services, India’s ports sector is expected to increase capacity by 500-550 MTPA (Maximum Torque Per Ampere) yearly between FY2023 and FY2028. Further, port expansion will be driven by increased handling of petroleum, oil, and lubricants (POL), coal, and containerized goods. India’s ports today handle 95% of the country’s export volume and 70% of its export value, demonstrating the sector’s importance in facilitating trade.

 

The sector currently works at a capacity of 2,604 MTPA, although this is likely to increase dramatically in the next years. Between FY23 and FY28, India’s ports are forecast to increase capacity by 500-550 MTPA per year, driven by sustained expansion in petroleum, oil, and lubricants (POL) handling, as well as coal and containerized cargo.

 

In addition, freight traffic is likely to increase at a constant annual pace of 3-6%, with utilization rates stabilizing at around 55% in the medium term. Container traffic is expected to expand at a 4-7% annual rate over the next five years, driven by rising imports, lower freight costs, and the normalization of global supply chains. Transshipment, which today accounts for roughly 25% of India’s container throughput, remains a significant market, with key ports such as Chennai playing an important role in supporting it. The research also emphasizes the different responsibilities that major and non-major ports play in India’s port ecosystem.

 

Major and Non-major ports to play a vital role

Major ports, which are supervised by the central government, are typically located near industrial areas and handle a diverse range of cargo types based on regional demand. However, shared access channels cause congestion at these ports on a regular basis.  Non-major ports, administered by state governments or private operators through public-private partnerships, exhibit greater operational flexibility and efficiency, resulting in less congestion.

 

Non-major ports experienced a 7.6% increase in cargo traffic in FY23, exceeding major ports’ 4.7% gain.  According to the research, both big and minor ports will play important roles in boosting the sector’s overall growth.  India’s ports will continue to play a crucial role in trade and economic growth due to increased cargo traffic, improved infrastructure, and operations, according to the research.

 

Government initiatives

The Indian government has adopted policies and initiatives to improve port capacity and efficiency. The Sagarmala Programme, which began in 2016, is a major program targeted at lowering logistics costs for both export-import (EXIM) and domestic freight. The program aims to boost port capacity to 3,300 MTPA by 2025, with investments of INR 6t over 800 projects.  Optimizing logistics efficiency and lowering transit time can save INR 350-400 billion yearly.

 

Other initiatives include the Maritime Amrit Kaal Vision 2047 proposes to create six mega ports with world-class facilities, increasing India’s port handling capacity from 2,500 MTPA to 10,000 MTPA by 2047. This strategy aims to achieve 100% cargo handling at PPP berths and integrate sophisticated digital technologies into port operations.

 

Conclusion

India’s ports are vital for its economic trade and growth, and with the country’s massive coastline and strategic neighborhood, there are significant upbeat opportunities for marine expansion. The Government’s policies to support FDI, Sagarmala, and the Amrit Kaal Vision 2047 are fostering growth in capacity and operational efficiency. All these efforts along with the rising significance of India’s major and minor ports, make them powerful engines for the country’s economic growth and global trade competitiveness in the future.

 

 

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US oil export to India becomes double in the month of February

 

 

 

 

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Maruti Suzuki sets the target of regaining 50 percent auto market share in India
Automobile News, Autos, Business, Equities, Markets - February 21, 2025

Maruti Suzuki sets the target of regaining 50 percent auto market share in India

Maruti Suzuki sets the target of regaining 50 percent auto market share in India

 

Maruti Suzuki is considered as the largest automaker in India. It aims to regain 50 percent of its market share in the Indian passenger vehicle segment by the year 2030. 

 

Market share of the company

In the financial year 2019, the company had a market share of 50 percent in the Indian auto market. In the last few years, it faced strong competition from its peers like Kia, Tata, and Hyundai. In recent times, the company recorded a market share of about 41.6 percent in India.

 

Performance of the company in 3QFY25

The company was successful in achieving its revenue and profit targets due to better sales portfolio, quality, and better condition of exchange rates. However, the company recorded a contraction in achieving its volume sales growth. It was driven by contraction in its market share in the Indian auto market and also strong competition in the EV sector. 

 

Roadmap of Maruti Suzuki

The company’s mid-term management plan is to accelerate the production capacity to around 4 million units per annum which will be twice its current production capacity.  It targets to become the top auto manufacturer in the domestic market, export segment, and also in the Electric Vehicle (EV) segment in the upcoming five years. To put this plan in implementation, the company is developing two production facilities in Gujarat and Kharkhoda. 

Maruti Suzuki highlights that India is a crucial market for automakers. It will continue to progress in the future as well. It will act as an engine for the progress of Suzuki in the future. In recent times, the auto industry is recording a highly competitive environment and also rising demand of consumers for high quality of equipment, services, and product functions in their vehicles. 

SMC, a parent company of Maruti Suzuki main focus is to expand product portfolio and develop its capabilities in order to meet the preference of the Indian auto market. The company plans to expand and improve its product portfolio in terms of medium and large Sport utility vehicles (SUVs) and Multi-purpose vehicles (MPVs). It also focuses on quick development and launching of affordable vehicle segments in the market which will satisfy the consumer preferences.

The company plans to launch vehicles in various segments like battery electric vehicles, hybrid electric vehicles, CNG vehicles, and fossil fuel vehicles. It will be designed and manufactured as per the geographic conditions and consumer preference in various regions of India.

 

Launch of e Vitara

In the month of January 2025, the company launched its first BEV e Vitara at the Bharat Mobility Global Expo 2025. It is set to be sold in both domestic and international markets.  Further, the company plans to launch about 4 BEV auto models by the financial year 2030. Its peer companies like Tata Motors already have a strong market and portfolio in terms of EV models. This entry of Suzuki in EV is considered to be a late entry. Despite this, it is important to understand that India’s EV market is still in the growing phase compared to other nations in the world. The company aspires to achieve a strong position in the EV market with the advantage of a large consumer base and extensive network of touchpoints.

 

The company will join hands with FinDreams, which is a subsidiary company of China’s BYD for the purpose of purchasing batteries for its EV model vehicles. In the upcoming years, it plans to localize the production which will align with the progress in the EV market. 

 

It also has plans to upscale the Nexa into a premium brand and Arena addressing a broader customer base. This will help in achieving the company’s goal to adhere to better customer experience. 

 

Collaboration with Toyota

Maruti Suzuki’s strategic collaboration with Toyota continues to remain strong by working as equal partners and competitors. Both the companies plan to create a carbon-neutral space with cooperation and aims to progress in the future. The company has the goal of achieving carbon emission reduction of around 42 percent by the financial year 2030.

 

Future Outlook

The company aims to achieve market share of 50 percent in the Indian market by the year 2030. Additionally, it targets operating profit margin of higher than or equal to 10 percent and return on equity of higher than or equal to 15 percent in the initial half period of the 2030s.

 

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Larsen & Toubro recorded strong revenue and PAT growth with highest quarterly orderbook in 3QFY25

 

 

 

 

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