News in Numbers: 9 states declare drought so far
What is it? The number of states that have declared drought so far. Telangana is the latest thanks to successive monsoon deficits. Ten districts covering 231 sub-districts have been declared as drought affected.
Why is it important? Distress in farm sector will affect rural demand and has the potential to fuel inflation in a few items like oilseeds because of lower output.
Tell me more: Rural India has 90.2 million agricultural households, and 63% of them depend on agriculture as the main source of income.
What is it? The amount paid by Idea Cellular, India’s third largest mobile operator, to buy airwaves in two circles from Videocon Telecommunications.
Why is it important? This is the first trading after the government allowed telecom companies to sell the spectrum they hold. The price paid by Idea is nearly twice of what Videocon valued it in March 2015, and it will help Idea offer 4G services in Gujarat and western Uttar Pradesh.
Tell me more: With Reliance Industries planning to launch its 4G services next fiscal, existing companies are sprucing their high-speed offering. Airtel, the market leader, is launching 4G services in 296 cities and towns.
What is it? The number of advance pricing agreements (APA) signed by Indian tax authorities with multinational companies. An APA covers future inter-company transactions belonging to the same group (let’s say, Accenture India provides service to Accenture UK) but located in different countries. It would specify the profit margins on top of cost, so that tax can be levied.
Why is it important? APA helps in reducing tax disputes especially in cases of related party transactions as there is certainty on how tax authorities will treat the transaction. In fiscal 2015, tax authorities disputed more than 50% of international-related party transactions involving upward revision of taxable income of Rs.46,465 crore.
Tell me more: Ever since APA was introduced in August 2012, the finance ministry received 329 applications till December 2014 and it had now signed 31 APAs.
What is it? The amount paid by Japan-based Nippon Life Insurance Co. to raise its stake in Reliance Life Insurance to 49% from 26%, the maximum allowed now.
Why is it important? This is the first deal in the life insurance segment after the government increased the foreign investment limit to 49% this year. Cash from sale could help Anil Ambani-controlled Reliance Capital to invest in other businesses or reduce debt.
Tell me more: On Monday, UK-based Bupa Plc acquired an additional 23% in the medical insurance joint venture, Max Bupa Health Insurance Co. Ltd, for Rs.191 crore, valuing the company at Rs.830 crore.
What is it? The value of the construction contract bagged by state-run National Buildings Construction Corp. (NBCC) to build 3,000 flats for the All India Institute of Medical Sciences (AIIMS) in Delhi.
Why is it important? Apart from providing residential accommodation for doctors and nurses working in India’s apex hospital, the project also entails selling 10% of the area to make it commercially viable.
Tell me more: Already NBCC is redeveloping 86 acres of government land just across the road from AIIMS. Even here residential accommodation is mixed with commercial space.
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