India's Climate Finance Outlook

Good Afternoon 🥦

India is gearing up for a climate showdown in the shimmering city of Dubai! Leena Nandan, the Secretary of Environment, Forest, and Climate Change, is leading the charge for greater clarity on the financial dance steps required in the battle against climate change. This conference promises to be a sequel to the climactic declaration adopted at the G20 leaders' summit in the heart of New Delhi, where India rallied the rich nations to hit the high notes by providing a cool $100 billion annually to help developing countries waltz their way towards new climate goals. 🌍

Important News of the Day

1. ‘India hopeful about climate financing at UN conference’

India is optimistic that the UN conference on climate change to be held in Dubai later this year will bring greater clarity on the “financial pathways” needed in the fight against climate change. Leena Nandan, environment, forest and climate change secretary, said that the conference is likely to build upon the declaration adopted at the recent G20 leaders’ summit in New Delhi. India called on rich countries to live up to their promise of providing $100 billion in annual climate finance to developing countries to meet new climate goals.

2. Justin Trudeau asks India to 'take allegations seriously' and 'cooperate' with murder probe

Canadian Prime Minister Justin Trudeau has urged India to take allegations seriously and cooperate with the ongoing murder probe of Khalistani separatist leader Hardeep Singh Nijjar. The western nation is currently investigating "credible allegations" about the involvement of Indian government agents in the June killing of Nijjar. The incident has led to a diplomatic row between the two countries, with Canada expelling an Indian diplomat and summoning the Indian High Commissioner to express its concerns. India has denied any involvement in the murder and has called the allegations "baseless and unacceptable."

3. RBI can spend $30 billion of forex reserves to defend rupee: Deutsche Bank

According to Deutsche Bank, the Reserve Bank of India (RBI) can use up to $30 billion from its forex reserves to defend the rupee. Even after spending this amount, the country will still have sufficient reserves to take care of import bills for the next ten months. The rupee has been under pressure recently, and this move is expected to help stabilize the currency. However, this intervention is running down currency reserves at a rate that's poised to eclipse the drawdown during turmoil a decade ago.

4. PM to lay foundation of international cricket stadium in Varanasi on Saturday

Indian Prime Minister Narendra Modi will lay the foundation stone for an international cricket stadium in Varanasi on September 23. The stadium will be built in Ganjari, Rajatalab, at a cost of about Rs 450 crores in an area of over 30 acres. The stadium will also boast essential infrastructure for international cricket. The inauguration and foundation laying ceremonies are significant as political parties across the country are gearing up for the general elections scheduled next year. In addition to the stadium, Modi will also inaugurate 16 'Atal Awasiya Vidyala' (residential schools) across Uttar Pradesh.

5. Rajya Sabha passes Women's Reservation Bill after 11-hour debate

The Women's Reservation Bill, which seeks to reserve 33% of seats in the Lok Sabha and state assemblies for women, has been passed by the Rajya Sabha after an 11-hour debate. A total of 215 MPs voted in favour of the bill, and no MP voted against it. The bill grants one-third of seats in the Lok Sabha and state assemblies to women, receiving strong support across party lines. The bill was presented by the Indian government and has been approved by the parliament. The bill is a landmark move towards gender equality and will increase the number of women members in the lower house to at least 181.

6. Oil prices fall nearly 1% on profit booking, concerns about higher interest rates

International crude oil prices fell by almost 1% on September 21, 2023, due to profit booking and concerns about higher interest rates. The November contract of Brent on the Intercontinental Exchange was trading at $92.60 a barrel, down 0.99% from its previous close. Analysts said that concerns of further rate hikes by the US Federal Reserve also weighed on crude prices. Despite this fall, the Brent crude oil price is expected to average $93 per barrel during 4Q23.

7. TVS introduces India's first electric motorcycle racing championship

TVS Motor Company has introduced India's first electric racing competition for two-wheelers, the TVS Racing Electric One Make Championship. This marks the company's entry into the realm of electric motorcycle racing, and it has created dedicated Apache RTE motorcycles for the championship. The e-OMC (electric one make championship) will debut at the fourth round of the Indian National Motorcycle Road Racing Championship (INMRC). The TVS Racing Electric One Make Championship is a significant move towards promoting electric mobility in India and encouraging the adoption of electric vehicles.

8. Banks to see margin pressure amid hike in deposit rates

Most Indian banks have taken a 170-210 basis points hike in their term deposit rates since December 2021, with larger private banks and State Bank of India (SBI) taking hikes of around 170-210 bps, while smaller private banks have taken lower hikes of 150-170 bps. As a result, with the rising interest rate environment, most Indian banks are likely to see some pressure on their net interest margins (NIM) over the next two to three quarters. However, banks with a higher share of wholesale deposits and reasonable hikes in MCLR over six months may be able to defend NIMs better than others.

9. It's high time to reduced taxes on fuel: AAP

The Indian government should reduce taxes on fuel to ease the burden on households and businesses. The high level of taxes and levies on petrofuels has a direct impact on households and businesses, leading to a reduction in spending on other essential items. The government has the power to ease the burden by making adjustments to taxes. However, the optimal gasoline tax is substantially higher than previous research has suggested. Higher gasoline taxes encourage work, and when this effect is taken into account, the optimal gasoline tax is substantially higher than previous research has suggested. The burden of subsidy reform is neutrally distributed across income groups.

10. Global economic slowdown may not significantly impact India

Amitabh Mohanty, CEO of JM Financial Mutual Fund, believes that India's growth will not be significantly impacted by the global economic slowdown. Mohanty stated that India is on a multi-decade growth path, and the impact of the global economic slowdown could be limited on the country. He also shared his views on markets, the economy, and the sectors he finds promising. However, the news article did not provide any specific details on the reasons behind Mohanty's optimism about India's growth prospects.

World News 🌎

• NIA seeks info on 10 pro-Khalistan terrorists involved in San Francisco Indian Consulate attack

• India suspends visa services in Canada citing ‘operational reasons’

• Azerbaijan claims control of Nagorno-Karabakh as Armenian forces agree to lay down arms

• After China, India crisis tests 'naive' Canadian diplomacy

• US current account deficit narrows in second quarter

• Bank of England halts run of interest rate hikes as economy slows

• UK PM Rishi Sunak defends shift in climate policy as 'realistic' approach

• BRICS members strongly condemn terrorism in all forms; commend India's G20 Presidency

• King Charles III is to visit fire-damaged Notre-Dame cathedral on day 2 of his visit to France

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