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India Business Briefs for June 14: Forex reserves hit new all-time high of $656b

The Reserve Bank of India logo (Photo: INDRANIL MUKHERJEE/AFP/Getty Images)

By: Shubham Ghosh

HERE are news in brief on Indian economy and business for Friday, June 14, 2024:

India’s forex reserves jumped $4.307 billion to a new all-time high of $655.817 billion for the week ended June 7, the Reserve Bank of India (RBI) said on Friday. The kitty had jumped $4.837 billion to $651.51 billion in the previous reporting week. The previous high for the kitty — a crucial guard against any disturbances in the external sector — was $648.87 billion on May 10. In the past few weeks, the reserves have witnessed handsome jumps. For the week ended June 7, foreign currency assets, a major component of the reserves, increased by $3.773 billion to $576.337 billion, the data released on Friday showed. Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound, and yen held in the foreign exchange reserves.

InterGlobe Aviation — the parent company of budget carrier IndiGo — on Friday said it will receive a “customised” compensation from American aircraft engine-maker Pratt & Whitney’s affiliate firm International Aero Engine (IAE) for grounded aircraft. “On June 14, 2024, InterGlobe Aviation Ltd finalized an amendment to the existing agreement with International Aero Engines, LLC, an affiliate of Pratt & Whitney pursuant to which IAE will provide IndiGo with a customized compensation in relation to the ongoing situation of aircraft on ground due to unavailability of engines,” InterGlobe Aviation said in a regulatory filing. The company, however, did not give the amount of compensation. A good number of IndiGo aircraft are grounded amid supply chain and engine issues.

India’s imports from Iraq rose 58.68 per cent to $3.76 billion in May, while from the UAE, the country’s inbound shipments increased by about 50 per cent during the month, according to the commerce ministry data. Similarly from Russia, the imports rose by 18 per cent to $7.1 billion on account of oil imports. The data showed that the inbound shipments from China during the month were 2.82 per cent higher at $8.48 billion. Among the top 20 import source nations of India, imports from Saudi Arabia, Switzerland, Japan, Germany, Hong Kong, Australia and Malaysia recorded negative growth in May. On the export front, India’s exports to South Africa, Italy, Nepal, Belgium and Australia recorded a negative growth rate during the month under review.

Markets regulator Securities & Exchange Board of India (SEBI) on Friday cancelled the certificate of registration of Grovalue Financial Services for flouting regulatory norms. It inspected the matters of Grovalue Financial Services, a Sebi-registered research analyst, from April 2021 to August 2022. The inspection was carried out to verify whether the books of accounts and records were being maintained or whether the provisions of the Sebi’s Research Analysts norms were being complied with by the noticee. “The noticee (Grovalue Financial Services) has contravened with the provisions of the Research Analyst regulations and failed to abide by the conditions of his certificate of registration,” SEBI’s chief general manager G Ramar said in the order.

While retaining its position as the fastest-growing large economy, India’s real gross domestic product (GDP) growth will moderate to 6.8 per cent in fiscal 2025 from 8.2 per cent in fiscal 2024, credit rating agency CRISIL observed in its recent report, citing high interest rates and lower fiscal impulse. It further elaborated on its forecast for the next fiscal year, saying higher borrowing costs and a possible cut in government spending will slow down the pace of the economy. However, it noted that the forecast of an above-normal monsoon brings hope for the rural economy, which was a laggard in the previous fiscal. According to the recently unveiled data by India’s statistics and programme implementation ministry, the country’s GDP surpassed all expectations and stood at 7.8 per cent in the January-March quarter.

(With PTI inputs)

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